Eight mistakes landlords make
Lots of landlords decide not to use an agent when they let out a property. But letting a property can take real expertise, and it is much harder to ‘do it yourself’ than many realise. By using Reeds Rains as your agent you’ll have 150 years of expertise on your side, which could help you save money, make extra profit and avoid falling foul of all the rules and regulations.
Our lettings experts have composed the following list of the most common mistakes made by DIY landlords:
1. Not understanding the market
Setting the advertised rent for a property is a balancing act. You want your let to be as profitable as possible, but overprice it and you could put tenants off leading to nasty void periods. You’ll still be paying the mortgage but not receiving any income.
Market rental prices are going up all the time too. If you’ve got a good tenant in place you don’t want to scare them off by putting up the rent, but you do want to make sure your property doesn’t fall behind others in the area.
2. Going for quick money (Gumtree, Facebook)
The prevalence of online selling sites like GumTree and Facebook Market Place make it really easy to advertise properties. But be warned – though you save money in the short-term, you could be losing out on the best market price for your property and on the best quality tenants.
3. Not seeking proper references
Good quality tenants pay their rent on time and will look after your property. Without proper references, you do not know the financial background of your tenant, and have no assurances as to their character. Seeking proper references helps to minimise your risks.
4. Not conducting a proper inventory
A good inventory gives a comprehensive and detailed overview of the state of your property and any furnishings before the tenant moves in. It is invaluable when the tenant comes to move out, acting as a reliable gauge by which to end any dispute. At Reeds Rains, we use 3rd party inventory companies to ensure landlords have independently approved redress.
5. Not using a reputable agent
The horror stories abound: agents going bust and disappearing with a landlord’s money; or agents giving terrible service and having no complaints process in place. Look for an agent who is accredited by a recognised body like The Property Ombudsman or Propertymark. That way, you can be sure that you receive proper advice and have good redress if things go wrong.
6. Bad legislation advice
The internet has been both a blessing and a curse for landlords. It means quicker access to suitable tenants, and it also offers up great tools to help manage a let. But it’s also the home to swathes and swathes of dodgy or outdated advice. The rules and regulations in the lettings market change so frequently that only a truly versed expert – with the time to stay updated every day of the year – is a reliable source of information. At Reeds Rains, we stay ahead of the pack and let landlords know whenever they need to act.
7. No financial planning for essential maintenance
Things can go wrong inside a property so easily, through no fault of the tenant: a boiler breaking down, a pipe bursting, damp. If it isn’t fixed quickly, you could be at risk of losing a tenant – and so losing a slice of your income – or of being in breach of health and safety rules. That’s why it’s important to have a rainy day fund ready to fix any essential maintenance quickly, so it won’t cost you more in the long-run.
8. No financial planning for void periods
Like maintenance problems, void periods can be difficult to plan for. When one tenant moves out you may need to make adjustments to a property before the next tenant moves in. Or, the local lettings market could be flat when you’re searching for a new tenant. It’s difficult to predict, and during those void periods you still need to cover the mortgage payments. Don’t be caught out – plan in advance for the worst case scenario.
When you’re renting out a property, it’s easy to get Reeds Rains on your side. Simply click here to book your FREE property appraisal today.