6 tips every buy-to-let landlord needs to know
Renting out property comes with its rewards - and its challenges. As well as Brexit uncertainty, the past few years have seen a number of tax changes and new regulations introduced into the buy-to-let sector, making investing in property much tougher and resulting in now being a difficult time to be a landlord.
Follow our top 6 tips to help you to protect and grow your buy-to-let business.
1. Target tenants to suit your property
Always advertise your property knowing exactly what type of tenants you are trying to appeal to and the rent they would be able to pay. On a very simplistic level, if your property is a family home situated close to a school, your target tenants are probably going to be a family, rather than a professional couple - and the rent should reflect this.
Understanding how to advertise and make your property attractive to your potential tenants is essential, especially if you want to avoid empty periods between lets.
2. Always get your tenants to sign a tenancy agreement
This one cannot be emphasised enough. Getting a legally binding agreement with your tenants, in writing, will not only ensure that both parties know exactly what they’re signing up for, but should help to protect you if, for example, your tenant cannot pay the rent or terminates the tenancy without notice.
3. Check you are on the best buy-to-let mortgage
If you needed to take out a mortgage to invest in your property, make sure that you are on the best deal - and consider changing your mortgage, if not.
Compare what different mortgage lenders are offering and see how much you could save by changing your mortgage. A mortgage broker, who knows the market in detail, can be invaluable.
4. Keep an eye on your expenses
Spending money on a letting agent to manage your property will put a real dent in your profits. Managing your property yourself can help to cut costs.
What’s more, if there’s any work that needs doing on your property, always get at least three quotes to ensure that you’re getting the best deal.
5. Keep records of everything
Keep a paper trail of everything to do with your rental - you never know when it might come in useful.
A thorough inventory completed when your tenants move in will be invaluable if you get into a dispute with your tenants in the future. You should also keep hold of receipts of any repairs you have undertaken, as well as all of the certificates you require legally, including proof of the annual gas safety check conducted by a registered engineer.
6. Familiarise yourself with the rules and regulations
As well as the annual gas safety check, landlords have to comply with regulations on everything from smoke alarms to the deposit protection scheme. Make sure you know what you are legally required to do and do it - otherwise you could face a hefty fine.