A beginner's guide to being a landlord
Learn how to be a good landlord - that is, one with respectable tenants and who makes money
Being a landlord isn't always plain sailing, sadly, and you do need to do your research. But done properly, it remains a good form of investment for the more enterprising among us. We examine some of the different ways people make money out of buy to let, and some of the pit falls that are best avoided.
The first decision to make is what market you are appealing to. Is it young professional sharer, single City worker, family or student? Each has its own benefits: the young professional sharer is considered one of the safest markets, as they will not be able to afford their own property so will always be looking to rent. City workers on the other hand often can afford to pay premium rents, but you have to get the location and type of property right (think contemporary new build flat in Docklands). Renting to students can offer higher yields and properties that don't require so much upkeep (though expect lots of wear and tear) and family houses again can command high rent in the right sort of area, and by and large, make responsible longer-term tenants.
If it is the professional market you are targeting, the next decision to make is whether you are appealing to short lets (say, three months or less) or long-term (12 months). The advantage of short-term lets is you tend to attract premium rents. The disadvantage is you can expect periods where the property is un-tenanted and not bringing in any money (called void periods). With short-term lets, you will also pay your letting agent a higher fee: typically 15 - 22 per cent, compared with ten per cent for long-term lets. Location, for short-term lets, is even more important than with long-term: tenants are often bank or City workers, who may be in the area on business for a month. It's most likely that they will only want to live in central locations.
1 | 2 | next
printer friendly
send to a friend
Delicious
Digg
reddit
Facebook
StumbleUpon
Horoscopes| Message Boards | Quizzes | Newsletters | Join
iVillage Ltd is a UK company registered in England & Wales (3837269) at 80-110 New Oxford Street, London WC1 1HB