Our Top 10 Tips for Landlords
The ownership of residential property is an investment. Whether the primary objective is generating income, increasing its capital value or the enjoyment of occupying it, owners will want to be sure that their investment is managed effectively.
They will expect their professional advisers to maximise the property’s income or capital value, maintain and manage the property and liaise with tenants. The property must be managed legally and economically, with income and expenditure entrusted to secure professional hands.
Here are our top 10 tips for Landlords:
1. Know your audience
Having a clear understanding of the intended target market for a property and presenting it accordingly will maximise rental yield, minimise void periods in between lets and guide investment decisions throughout the length of your investment.
The questions to ask are:
- What type of Tenant do I want?
- What things is that Tenant looking for when they rent a property?
- What do I need to do in order to appeal to that Tenant?
2. Understand the market
The letting market comprises many different segments, each with their own nuances and specifics. Think carefully about how the market operates and choose an Agent who understands how the market operates and can advise you accordingly.
The questions to ask are:
- What is the best strategy for my property?
- How can I maximise my income?
- What contract terms are most suitable for me?
3. Ensure that your property complies with legal requirements
Residential tenancies have been subjected to a mass of complex controls and regulations ever since legislation was first introduced in 1915. Landlords need to be aware of their responsibilities and of the penalties for failing to comply, which can range from civil action to criminal prosecution.
Every stage of the property management process is governed by legislation. At C.P. Walker & Son, as members of the Royal Institute of Chartered Surveyors (RICS), we are bound by best practice guidelines ensuring that all relevant legislation is fully complied with and changes to the legal framework are disseminated to our Clients.
The main areas of legislation concern:
- Energy Performance Certificates (EPCs)
- Gas Safety
- Electrical Safety
- Smoke and Carbon Monoxide Detection
- The Housing Health and Safety Rating System (HHSRS)
4. Prepare the property for marketing
Finding a good Tenant quickly is key to maximising income from your property. Regardless of a property’s size, location or target Tenant – those that let best are those in a modern, clean and tidy condition.
Prior to marketing, make sure that the property:
- Is free from defects such as mould and condensation
- Has a modern appearance and doesn’t feel dated
- Is ready to be occupied (i.e. clean, windows dressed, lights working)
5. Unfurnished or furnished?
This is always a tricky question on which to give advice, as there are usually tenants looking for both. The choice as to which way you decide to go will in part depend on your own investment considerations and also the strategy that you decide to adopt to try and ensure that the property is let to your intended market as soon as possible.
Some things to consider are:
- What is the target market more likely to want?
- Rents of furnished properties are typically £50-£75 higher than unfurnished
- It’s best to pick a strategy and stick with it – avoid ‘part furnished.’
- It is increasingly common for Landlords of unfurnished properties to supply a washing machine and fridge/freezer
6. ‘Let Only' or 'Managed'?
Think about who (either you as Landlord or us as Agent) will manage the property after it has been let. Ultimately this comes down to what is best for you, the Owner.
Many Landlords have the sufficient time and experience to be able to deal with managing the property themselves, whilst others prefer to instruct an Agent to do this for them.
In deciding what is best for you, consider:
- How easy is it for you to co-ordinate maintenance issues and visits to the property?
- What level of understanding do you have about the legislation governing tenancies?
- How much direct contact do you want to have with the Tenants?
- How do the costs and fees differ?
7. Get the ‘right’ Tenant
Selecting a good Tenant is the most fundamental part of the process. Any mistakes made in this decision can create problems at a later stage. Good Agents can help guide you towards the best Tenants and away from the worst ones.
This done by a combination of two factors:
- Evidence: Obtaining proof of an Applicant’s income, credit status and rental history.
- Experience: Good Agents will have developed an understanding of different Tenant profiles and any associated risks. This can be used in addition to, or instead of, any gaps in an Applicant’s evidence if for example they haven’t lived in the UK before.
8. Budget sensibly
Property ownership carries with it risk of ongoing costs, often unforeseen.
Make sure that your financial planning takes account of:
- Mortgage costs and rises in interest rates
- Income tax
- Repairs and ongoing maintenance/improvements
- Late or non-payment of rent
9. Have adequate insurance
Owners should notify their property insurers prior to granting a tenancy. If the house is being let furnished, the consent of the contents’ insurers will also be needed. Owners may be advised to convert their Buildings and Contents Insurance to a 'Landlord’s' policy. Our Insurance Department can give specialist advice on suitable policies.
Landlords’ insurance includes cover for:
- Rent protection in the event of an insurable peril such as flooding or fire
- Malicious or accidental damage by Tenants
- Property Owners’ liability
- Landlords’ contents cover
To find out more about C.P. Walker & Son’s insurance department, please click here.
10. Choose Agents wisely
Letting Agency remains are largely unregulated industry – anyone can open an Agency without necessarily having qualifications, experience or knowledge.
Choosing an Agent with a proven track record of letting and managing property in your area and one regulated by a respected industry body is a key to making the right choice.
To read more about why C.P. Walker & Son are the right choice for you, please click here.
"In several years renting, you've been by far the best estate agent I've ever dealt with. [Tenant for 2 years]"