People become landlords for many reasons. For some, the process of buying and renting a property will be a well thought through investment opportunity. For others, it can almost be the accidental result of inheriting or otherwise ending up with an additional, unneeded property – for example moving in with a partner.
The benefits of being a residential landlord are plentiful. A report in Find Law highlights extra income and tax benefits as some key financial gains, but there is also a lot to be said for the security of knowing that you have an additional property available should you ever need it.
So, becoming a landlord is definitely lucrative but not always as simple as you may initially think. Here are some top tips for those starting out as a new landlord.
Remember that being a landlord is a business and treat it as such. That means marketing it professionally and dealing with tenants in a businesslike manner. Sometimes, people prefer to let their properties to people they know, but even if this is the case, it’s important to keep the lines of communication professional and clear. Build a business relationship rather than a friendship.
Work out your finances
A rental property does mean an extra income, but there will also be costs associated with it, particularly if you are using a mortgage to buy a rental property. Add to this maintenance, repairs, insurance and periods of time when the property could be empty and you should be able to work out if this will be a manageable expense or an enterprise that could be costly.
Always obtain references from prospective tenants and, where possible, proof of their income, so you know you can rely on a regular payment. It’s recommended to carry out an inventory or property inspection report prior to the tenants moving in to cover you in the case of any damages (https://inventorybase.co.uk/).
Understand your obligations
It is the responsibility of any landlord to ensure that the property is safe and fit to live in. This means ensuring a range of regulations are complied with, including gas safety, fire alarms, electrical checks and protection of the tenant’s deposit through a government protection scheme. Essential maintenance and repairs in the property are also down to the landlord.