So you want to be a landlord?
However before signing on that dotted line and committing to life as a landlord, it is important you understand both the financial risks and legal responsibilities a landlord faces on a regular basis.
To help you make sure this is the life for you, our team of experts suggest you think about the following before you invest in a buy to let property:
Just because the overall buy to let market is good, doesn’t guarantee it’s prolific for every region. Consider what facilities there are in that area. This should help you get an idea of how many and what kind of tenants you could expect and therefore what sort of property would be best suited. For example if there is a university within the vicinity, a student let would be the most appropriate.
It is essential to understand the amount of rent you can expect from a property to ensure you can afford a second mortgage. Your buy to let mortgage application is likely to be dependent on the amount of rent you will need to charge against the estimated rental potential as well as your additional monthly outgoings.
Many landlords think that as long as the rent covers the mortgage then the financial risks of letting property are mitigated. However as a landlord you are responsible for all repairs to the property as well as letting expenses, advertising and, where applicable, professional fees such as a letting agent or solicitors. There is also the risk of your property becoming vacant. During these periods you will still need to pay the mortgage and such bills as council tax, utilities and insurance.
If you are managing the property yourself, you need to be aware of the impact it can have on your free time, particularly if you are in full time employment. Should the tenants encounter a problem with the property, the boiler breaks down for example, it is your responsibility to get it repaired and properly tested as soon as possible.
As a landlord you have legal responsibilities from the outset. Before tenants even move in there are a number of things you must have in order including obtaining a gas safety certificate and PAT testing any electrical appliances. There is also strict legislation for regaining possession of your property, tenant deposit protection and rent increases.
It is important that anyone considering getting in the letting game fully understands everything involved and has the necessary professional support at hand, from an experienced electrician to a specialist legal expert such as Rob Denman at GW LET who provides legal help and advice for landlords throughout their letting journey, from writing tenancy agreements right through to tenant eviction.
Content correct at time of publication