From getting a property ship-shape, to understanding your new legal responsibilities, becoming a landlord for the first time can feel like a daunting prospect.
Whether you’re an “accidental” landlord after deciding to rent your house in a sluggish selling market, or you’re planning to start a property empire, getting to grips with the basics of letting out a home could save you some grief further down the line.
If you are looking to invest, you’ll want to choose your property wisely. Rising mortgage rates, as well as recent tax changes for landlords, may be leaving some seeing their profit margins squeezed. So choosing a property in the right location is even more vital for maximising returns.
Research from TotallyMoney suggests university cities could be worth considering, with parts of Liverpool, Plymouth, Preston, Nottingham, Bradford, Manchester, Sheffield, Leeds, Cardiff, Glasgow and Aberdeen identified as buy-to-let property hotspots.
Here are letting agents’ body Arla Propertymark’s top tips for budding landlords…
Do your homework
Get to know your market. Research similar properties in the local area and find out how much they are being let for per month. If your rent is set too high or too low prospective tenants will steer clear.
It’s also worth considering what type of renter the property will appeal to, such as young professionals, families or students.
Once you’ve done your homework, set a competitive price and aim to keep it filled at all times to minimise rental voids.
Know your responsibilities
With your new status comes great responsibility. In the first instance, check that your mortgage allows you to let out your property, as some agreements include caveats to prevent homes from being rented. If you are unsure, speak to your mortgage lender and they will be able to advise you accordingly.
Ensure you’re insured
Your existing buildings and contents insurer must be made aware of your intention to let your property as it’s likely your policy will need to be amended. Specific landlord insurance policies can protect the building, your tenants and your investment as a whole – some policies will also pay out if your tenant misses their rent payments.
Vet prospective tenants
You may wish to meet potential tenants before agreeing to let them your property, or you may prefer to leave it to your letting agent, if you use one. An agent can perform reference and credit checks on potential tenants to ensure everything is reliable.
Know the law
When it comes to being a landlord, there are more regulations to comply with than you can shake a stick at. A written tenancy agreement will help both you and your tenant understand rights and responsibilities and make sure you understand your responsibilities to make sure the property is safe.
Choose the right agent
If you do decide to use a letting agent, a good one can take away the stress of finding suitable tenants and also ensure your property complies with any regulatory changes. You will need to factor this into your budget though.