Being a landlord is not as easy as people think. Whilst there are numerous benefits, the stresses of managing tenants and properties can be a minefield. There are various things that can go wrong so we’ve decided to highlight the most common pitfalls of letting a home and how to avoid them.
A common mistake that landlords make when letting a property is not vetting potential tenants. Nightmare tenants are a real thing and could easily happen to you. It is crucial that you have references and it doesn’t take long to get in contact with a tenant’s previous employer or landlord. You may soon regret it if you forget to do so.
Lots of landlords are unable to detach themselves from the property. This is not your home and is now a business transaction. Instead of spending lots of money and time decorating the property to your taste, keep the décor neutral and simple. The goal is to make the property appealing to as many people as possible so remember functionality over fancy design.
We all want money and overpricing the property is another common pitfall which landlords often make. Renters are likely to be searching the local area so price your property competitively. In today’s digital world, it is now easier than ever to research the local market.
Before you rush into the decision of whether to let your property or not, as a landlord you also need to ensure that you are financially stable. You need to ensure you have a budget, which includes the cost of renting as well as any reparations that may be needed during the process. It is important to look into your mortgage as well, as some don’t allow you to let properties. Calculate what you can afford and all the expenses that you may face including tax implications.
It is easy to get complacent and after the first few checks, landlords soon relax and forget to keep tabs on the property. Aside from cleanliness and how the property is being treated, inspecting the property also allows you to see whether the tenant is doing things without consent. You will also be surprised at how many landlords go without a formal tenancy agreement. This is a necessity – even if you are letting to a friend. You’d be surprised at how often things go wrong. It is also required that all tenants’ deposits are protected in a Deposit Protection Scheme and remember to get landlords insurance.
It’s very easy to look at things with a business head but be realistic and approachable. If your tenant has been a perfect resident and then informs you they will be late with one payment, try and be understanding. Remember being respectful and cooperative will only reward you with similar behaviour from the tenant.
Keeping these common pitfalls at the back of your mind will help you avoid them during the process of letting a property, hopefully resulting in a quick, stress-free and hassle-free process. If you have any questions about letting a property, then please get in touch.