Buying a home and renting it out can be extremely profitable. You will not only earn a rental income, but the property will also appreciate in value over time.
Although the home you are renting is an investment, you must ensure that it is adequately cared for and maintained.
Of course, you may be preoccupied with work and family obligations, and while purchasing to let is a business, it may not always be your top concern.
That's why we've put together a document called "10 Tips for Buy-to-Let Success." These suggestions are based on our extensive expertise in assisting landlords in running profitable companies.
Contact our expert estate agents for advice on the rental market in London and the surrounding areas.
Select a property wisely
You may want to invest your money as soon as possible in order to start earning a profit, but first, you must conduct your research and examine the type of property you want and the time of tenant you require. You may be considering students, but you need to think about the market, and whether there is a need for student rentals in the area.
Contact our expert property agents for help and advice with choosing a new property. We know the property market and can provide you with the appropriate advice.
1. Decide what level of involvement you want.
Decide on the type of landlord you want to be. Will you be hands-on and carry out much maintenance yourself, or will you hire somebody to do it for you?
The best advice from us is if you’re going to rely on a tradesman is to ask about and compile a list of reliable contacts to call when needed.
Or, you can contact your local Ellis & Co branch, to find out more about our fully managed services, taking the stress off your hands.
2. Do you intend to manage the property?
There is a list of things you must do when managing a property, such as obtaining gas and electric certificates, collecting rent, dealing with maintenance and other issues, and if necessary, managing the eviction process.
Contact your local Ellis & Co branch for more information on the upcoming change in compliance in England.
So, do you want to handle this much of the management yourself, or do you require the services of a lettings manager?
Our top tip is, if you wish, we offer property management services which means we can help you find a tenant, work out the contracts and manage the property.
3. Recognise the value of potential net returns
You might have enough money in the bank to invest in property. However, when making a big investment like this, it’s important to do the maths. Sit down with a pen and paper and consider the expenses, such as:
- Insurance for Landlords
- Gas and electric safety certificates, as well as maintenance
- EPC (Environmental Protection Certificate)
- Repair and maintenance costs
- Periods of Vacancy
- Acquisition of a Tenant
- Bills for utilities
- Fees for Management
If you need help working out the expenses, our estate agents will be more than happy to help!
4. Research the current property prices
Property is a great way to invest your money, and see it appreciate over time. So, being aware of the current house prices is a great way to see your money grow.
Our best advice is to be patient and make sure you’re in it for the long haul. Markets can fluctuate, but a good landlord knows this and sticks with it over time.
5. Get the right insurance
We strongly suggest that you get Landlords Insurance, Buildings Insurance, and maybe Contents Insurance. It's better to be safe than sorry, and you'll know you're covered if something bad happens.
The best advice is to speak with a seasoned insurance agent. They'll explain why you need the coverage you do.
6. Be organised and keep track of everything
Of course, a buy-to-let home is best when it has a paying tenant. It costs you money when it is empty. Landlords that are able to find a tenant quickly are the ones who have thriving businesses.
The best thing to do is to ensure that your paperwork is well-organised and in good working order. Maintain a list of recommended vendors, such as plumbers and electricians, to ensure that any work is completed fast.
7. Choose the right lettings agent
Ellis & Co’s lettings agency will advise you on which areas to look in when purchasing a house and will be familiar with the types of rent you can expect. They'll be able to make recommendations for tradespeople and handle the contracts. It's worthwhile to do your homework and assemble the best team possible.
8. 10. Make a Future Plan
Ask yourself the following questions when you have a rental property to rent out:
What is your property's long-term goal?
Do you have any plans to sell it in the future?
Is it something you'd like to preserve and live in at some point?
Best Advice: Set your objectives from the beginning. You'll know what to do and when to make the appropriate selections this way.
If you need advice on buy to let success, contact your local Ellis & Co office.