When it comes to working for yourself, one of the most popular job choices is to be a landlord. Being a landlord can be extremely rewarding. However, it is also hard work and comes with a lot of responsibility.
If you are considering becoming a landlord, then here are some tips for how you can be a successful first-time landlord in 2020.
Finding the Right Property
One of the first things that you need to do when you are considering becoming a landlord is to assess the local area for possible buy-to-let properties. In order to choose the right buy-to-let investment, there are various things that you need to consider.
It is important that you choose a property close to where you live so that you are able to be on hand in case of emergency. You should also choose a property that you would like to live in, and that is in good condition.
Consider the location of the property in relation to house supply, for example, is there a lot of demand for property in the area? Is the area a good place for student accommodation? Avoid new builds, as they often won’t have unique aspects to differentiate them from others and be sure to buy for your market. If you intend to rent to young families, for example, then a large property with many bedrooms is unnecessary.
Spend Time Preparing the Property
The property that you buy to let should be in perfect condition when you let it out. This means that before you put the property on the market for let, that you spend some time preparing the property for letting.
There are various things that you should look to do with your letting property. First and foremost, you must ensure the property is fit for human habitation. You must make sure the building is secure with a safe layout, as well as having enough natural light and clean, running hot and cold water. There must be good ventilation and no serious damp, drainage or toilet issues. There must also be adequate for cooking and washing up facilities.
Also, as of July 1st 2020, there are new electrical safety standards regulations that landlords will need to adhere to in properties that they plan to let, so, you will need to ensure that your buy-to-let property adheres to these new standards as well.
Advertise the Property Properly
In order to get the best return on your investment, it is important that you are advertising your rental property properly. This means making the best use of all of the channels available to you.
For example, online property portals such as Rightmove and Zoopla are some of the most popular ways of advertising a property for let. These sites, and others like them, are the most widely used method of searching for a property to let, so it would be foolish not to use them to your advantage.
Also, consider using a letting agent as they will have prior experience in advertising properties for let. Social media is also a good option for advertising your property as available to rent.
Background Check Potential Tenants
It is always important that you perform a background check on any and all potential tenants that are interested in renting your property. There are various reasons why background checks are a good idea with some of the main ones being:
You’ll get to know more about your possible tenant
You’ll know if they are finically capable of meeting payments
You’ll see if they have had any trouble being a tenant previously
As well as checking the tenant’s history.
If you don’t wish to do a full background check, then you should at least do a credit check and get a reference from a previous landlord (if applicable) and a workplace reference. These precautionary measures are going to help ensure that you don’t end up dealing with nightmare tenants going forward.
Have Everything in Writing
The best way to safeguard yourself from any issues in the future is to have everything down on paper. Everything from a risk assessment to a tenancy agreement should be down on paper and signed by both parties.
There are various reasons for this, but most importantly, it gives both you, and the tenant, a paper trail to follow that should resolve any disputes fairly easily. Having your properties risk assessment, gas and electrical checks all on paper will stop you being liable if an issue arises as you have documented proof of safety.
Also, document even menial things such as a property inventory and gas/electric meter readings when you have new tenants moving in, as this will help keep your records right in the future.
In the UK, all landlords must store a tenant’s deposit in a government-backed tenancy deposit scheme (TDP) if you are renting on an assured shorthold tenancy that began after April 6th 2007.
The point of these schemes is to ensure that a tenant is able to get their deposit returned in full, provided they meet the terms of their tenancy agreement, do no damage your property and pay their bills and rent.
It is mandatory to keep your tenant’s deposit in a TDP until they move out of the property. A tenant’s deposit must be put into a protection scheme within 30 days of you receiving it and paid back to the tenant within in 10 days of them moving out of your property.
One of the best things that you can do to ensure you are a successful landlord is to be present. This means that you should strive to make sure that your tenants can, and feel comfortable with, reaching out to you if they need anything.
While you don’t need to be your tenant’s best friend by any means, you do need to be there to solve any issues that may arise. Try to remain on good terms with your tenants to stop any trouble down the line, but don’t be afraid to be firm where necessary.
Being a landlord is no easy feat; however, with hard work and dedication, you can certainly be a successful landlord – even from that very first property. By following the advice that has been laid out in this article, you will be on your way to becoming a successful landlord in no time.
Chris Smith is a writer and blogger. Over his career, he has written for a number of publications, including The Guardian, The Telegraph, GoDaddy and The Huffington Post. He writes about sport and finance on his website, Spend It Like Beckham.