Experience as a first time landlord, together with several years working in a letting agency, has taught me much about the letting industry. Being a first-time landlord was a steep learning curve.
Would I do it again? Possibly, but I would do many things differently, and some not at all! This would have led to a very different outcome.
So, let’s start with:
What to consider when looking to purchase a buy-to-let property:
- Location – probably the most important thing. Try to choose one that’s in a popular area, close to a school, within walking distance of a town and has good travel links.
- Be realistic – establish your budget, making sure you take into account legal fees, estate agency fees and potential property repairs. If the property needs upgrading, for example double-glazing, add that into your budget too. Think about what repairs and upgrades actually need to be done.
- Budget – if you can afford it, consider a family home. A two or three-bedroom property (in Uckfield) will give you considerably more monthly rental income than a flat. Also, if you purchase a flat you (the landlord) will be responsible for paying the ground rent and any other maintenance fees. It all adds up and will eat into your profit.
- Negotiate – don’t be afraid to negotiate the asking price, especially if the property has been on the market for a while. You might be pleasantly surprised!
- Survey – if you are worried about potential problems, it’s best to ask for a more detailed survey. Be sure to find a surveyor with good online reviews. We recommend Downlands Architectural Design & Surveying in Framfield. If the survey does highlight problems, investigate further. Don’t wait till after the sale completes…then it’s too late!
- Solicitor – it makes sense to choose a reputable solicitor too. One that’s local helps, particularly if you come across issues during the process. Don’t be coerced into choosing one that you don’t know.
- Check the sums – don’t assume that invoices are correct. Sadly we had to query the solicitor’s invoice three times before they got it right! The same applied to the final completion invoice!
- If the property needs upgrading, or requires work, think about the quality of what’s required. There is no need to spend a lot of money on a new kitchen and bathroom, if they’re fine as they are. The same applies to decorating and carpets. The important thing is that everything works, is clean and in good condition.
- Two upgrades that are worthwhile, will make your property more desirable, and will add value when you sell it on, are double glazing and central heating. If you have a gas fire and/or central heating, you will need a Gas Safety Certificate.
- You also need to purchase landlord and contents insurance for peace of mind.
- If the property does need work, inside or out, do it before you show any potential tenants around, as this can be off-putting.
Tenant Finding and Management
- Agency or do-it-yourself? If you use social media, finding a tenant can be relatively easy, however, if you want to ensure a good quality tenant with a faultless credit rating and references, an agency is the way to go. They will either just find a tenant for you or manage the property for you. Fees are according to level of service. I would always recommend using an agent, to find a good tenant for you at least.
- If you choose to manage your property yourself, ensure that you keep on good terms with your tenants. I would recommend doing a quarterly inspection of the property, so you can keep an eye on things and avoid any potential problems.
- Pets – although it’s a difficult choice, it’s better not to accept pets as they can damage your property (new carpets is a common consequence and will cost £100s).
- It’s better not to let a friend become a tenant. It could damage your relationship if you have problems down the line.
- If you’re managing the property yourself, create an inventory, including photos.
- Issues – if there are any maintenance issues, find out what caused them. For example a blocked drain is usually caused by mis-use and is the tenant’s responsibility to unblock it!
Advantages of allowing a letting agent to let and manage your property:
- It’s the agent’s responsibility to sort out any problems, including maintenance and repairs.
- They will help you prepare your property prior to letting.
- They will ensure you meet the legal obligations.
- They can find the most suitable tenant for your property quickly.
- They will advise on the potential rental income and do any negotiating for you.
- They will organise an inventory and deal with the deposit for you.
- They will do tenant referencing and credit checks.
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