Money Saving Advice for Landlords

Written by Karen Bryan

Entering the property market can be a nerve-racking experience, and with so much to take into account it can be costly too. If you’re thinking of buying and renting out a property, or, if you’re already a landlord looking to keep costs down, there are loads of tips and tricks that can help. Don’t forget, however, you can follow all the tips in the world but you still need to cover yourself appropriately, in case something does go awry. HomeLet landlord insurance ensures that if the worst happens, you at least have protection on things like loss of rent or malicious damage. Here’s some other useful money saving tips to consider.

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Don’t Ignore Brexit

After Britain voted to leave the EU, people across the nation began to panic about how far the pound would inevitably drop, and the impact this would have on their investments. Bear in mind that the double-digit house price growth of the past two years is likely to dwindle, and with the pound set to fall further, the price of consumer goods will continue to rise. Therefore, landlords cannot feasibly expect tenants to be able to afford a major hike in rent prices.
Brexit isn’t all bad for landlords, however, and those with experience know that no matter what happens in the financial industry; the demand for rental properties will always be there.

Savvy investors can actually use the anxiety surrounding Brexit wisely, by taking advantage of the growing fear surrounding buying property. This is likely to lead to a drop in property prices, especially in cities such as Manchester, Leeds and Liverpool, which means places can be snapped up at a cheaper rate.

Choose Your Tenants Carefully

A bad tenant can end up costing you a fortune both during and after their tenancy, whereas find a good one and they shouldn’t, in theory, cost you a penny. It’s easy to think you need to fill an empty property fast, and tempting to choose the first person that shows any interest, although this isn’t always the most cost-effective practice. They might save you money at first by occupying the property, but the amount they could end up costing in the long run could easily counteract this.

Late rent, mess and property damage can all end up being headaches for landlords, so make sure you screen all possible tenants thoroughly. Although most individuals are clean living and respectful, there will always be a few exceptions. Credit checks are essential, don’t simply take their word for it, otherwise you may end up chasing months worth of unpaid rent, which will cost you time and money. References are another necessity, you can either use an agency or simply ask the tenant for two referees, but either way, make sure they’re reputable and reliable before signing the bottom line.

Aside from screening your tenants beforehand, make sure you carry out regular inspections. Lay these out in the contract from the start, in order to avoid any arguments or legal disagreements. This way you can keep an eye on the property and sort any issues fast, before they end up costing you a small fortune.

Keep an Eye on the Law

It might sound obvious, but keeping an eye on any new laws or government legislations is essential. There are constantly changes being made that as a landlord you’ll need to be aware of, if only to cover your own back.

Two of the major changes that you need to be aware of happened earlier this year. Firstly, as of April 2016 when purchasing a new property landlords must now pay a 3% surcharge on the stamp duty already owed. This a major thing to take into account when assessing your finances, and whether you can afford to buy the property in the first place. Secondly, is the removal of landlords wear and tear allowance. Previously landlords could claim 10% of rental income to cover the costs of wear and tear left by tenants. Now, however, you can only claim expenses for the actual costs of the damage. This change is yet another reason why picking your tenants carefully is so important, otherwise you may find yourself financially down after dealing with any mess or damage that may occur.

With more changes set to hit in 2017, make sure you get yourself clued up on all the laws and legislations that could end up impacting on your bank account. Keeping up-to-date means you’re not likely to miss a thing, as it could be the smallest change that causes the biggest impact.

With so much to think about, following these top tips should help you to save money and not find yourself in a financial disaster. If you’re debating buying property to let or even if you already do, seeking professional financial advice is always highly recommended.

For further tips and advice with a regional relevance check out thw free, informative eBook from HomeLet.