10 Ways To Get The Most Out Of Your Buy To Let
It is estimated that renters will outnumber home-owners by 2025. If you are looking into property investment this might be the best time to start investing in buy-to-let properties.
To maximise your investment, we have 10 tips to help you.
Furnish your property, properly
An effective way to increase your property rent is to furnish your property according to your target price. For example, if you’re looking for sophisticated, professional tenants in their 30s, they are done with student life and they will be looking for a more mature home and better-quality furnishings.
Not only does a better quality property encourage tenants who are cooperative and pay rent on time, but will also push your property rent up, maximising your property investment.
Minimise unoccupied time periods
An unoccupied or void period is the duration when your property is empty and has no rental income, and this could cost you dearly if you have a mortgage you need to continue to service. Renters are savvy when it comes to spotting opportunities to drive down monthly rents, and a property that has sat vacant is a key bargaining tool used to negotiate rents downwards.
The possible causes of a void are that your contract with your current tenants has ended but you don’t yet have new tenants or that your tenants are moving in later than the move-out date of your current tenants.
Price attractively, get people in first – and then negotiate
Try to set a competitive price; you could even price a little bit lower than your target. But this way, you can at least get renters through the door, and then you can negotiate, and maybe even increase the price through bids.
If you have a mortgage on the property, it’s always worth doing a mortgage MOT to see whether you could maybe switch to a lower interest rate. This could save you thousands of pounds, you can then spend that on upgrading your property, or towards the cost of an additional investment.
If you need any help with your mortgage or any other financial advice, we’d love to put you in touch with our financial partners, SPF Private Clients.
Price your property correctly
Bear in mind that it’s the market that sets the rent – you can ask for any price, it’s up to the tenants whether they are willing to pay that amount or not. Take advice from your estate agent and look at the rental asking prices for nearby properties which are similar.
Prepare your property
Prepare your property by fitting it with nice furniture, simple decorations, replacing old white goods, etc. You want to create an excellent first impression, as that what will last in your potential tenants’ mind.
Try to avoid break clause contract
A break clause entitles tenants to end a yearlong contract 3 months or 6 months in. This also means that there is a risk that your property could go back onto the market after a few months, and you are looking for tenants again.
Aim for a longer-term contract
Ensure that your contract is as long as you can reasonably accommodate. It might be worth considering whether you will need the property to perhaps live in yourself or to loan to a family member, but if that’s not the case, aim for a longer contract term, which will ensure that your tenants are secured for a longer time.
Build a good relationship with your tenants
No one likes moving unless they really have to. Good tenants tend to keep to a property long-term. Likewise, good landlord tends to have long-term tenants. On top of that, there is always an opportunity for you to increase your rent after a contract year, maximising your investment even more.
Be friendly, communicate efficiently, be prompt on responding to tenants’ requests and try to help them as much as you can. Try to make sure you have the support of good quality, reliable plumbers, decorators and engineers in case anything needs fixing. Maintain a good relationship with everyone.
Remember, whilst you own the property, the tenants are living there, it is their home. They are to have 24 hours’ notice of a visit by the landlord by law.
Allow the property to be let unfurnished or furnished. This way you can reach both groups of renters. You can rent storage for the furniture if your tenants want the property unfurnished, and you can provide extra furniture for the renters if required.
Whether you want to know more about investing or ready to make your first move, feel free to contact our Land, New Homes, & Investment department at 020 8099 1111.