How Much Work is it to Manage Your Buy to Let Property?

How Much Work is it to Manage Your Buy to Let Property?

April 28, 2017

How Much Work is it to Manage Your Buy to Let Property?

With financial forecasts still looking gloomy, and with the economy showing little signs of life, investors are continuing to turn to Buy to Let properties as their primary savings pot. In recent years, BTL has been a “no-brainer” investment choice: the steady increase of property prices combined with a buoyant rental market has made it relatively straightforward to become a “hands-off” landlord, and the returns available have been better than most other savings options.

For many owners of rental properties, the nitty-gritty of actually dealing with tenants has been largely kept at arm’s length through the use of property management agencies. However, recent changes to the laws surrounding buy-to-let investment have made it more expensive for landlords to own and rent out property; higher Stamp Duty fees have increased the cost of purchasing property, whilst a reduction in tax relief is set to make renting property less profitable in the long run. In addition to this, lettings agents will soon be prevented from charging tenants any fees, which is likely to make it more expensive for landlords to use an agency.

Succeeding in Buy to Let

What this all means is that Buy to Let investment as a whole is likely to become less profitable in the near future, and if savers wish to reap the rewards of their investments they’ll need to get more involved with their own properties. As an experienced local estate agent we’ve helped many landlords choose perfect properties that suit their investment needs, and as a lettings agency we know what’s needed to keep tenants happy. Becoming a part-time landlord might sound daunting, but we don’t think it’s as hard as most people think; here are our top tips for Buy to Let investors who are willing to work to make their property profitable.

Know when to do it yourself. Nowadays it’s rare for people to tackle problems in their home with their own two hands – so many horror stories circulate about careless DIY mishaps that people are terrified to take on tasks that no-one would have blinked at just a few decades ago. Don’t automatically assume that you’ll have to call a specialist in; plenty of property repairs can be made with proper preparation and the right tools. Of course, you need to know when not to have a go; electrical and gas equipment should be off-limits, as should anything with the potential to cause major damage.

Treat it as a business. You’ll need to put boundaries in place to ensure that your rental property doesn’t end up taking more time out of your day than you’d like. Make sure that you have a separate contact number and address for your lettings business – don’t give out your personal details to tenants. You’ll also need a dedicated bank account for tenants to transfer rent in to.

Plan ahead. Much of the stress involved in becoming a landlord can be avoided by taking care of problems before they arise. Set up a digital calendar with reminders of key dates, such as rent renewals and safety certificate expiry dates. Ten minutes spent setting reminders here can make life a lot easier further down the line.

Don’t be afraid to re-finance. Chances are, once the fixed or tracker period on your mortgage expires you’ll no longer be on the best rate available. If your mortgage doesn’t have early redemption charges, shop around for the best deal; it’s easier than ever to switch, and chances are you could save yourself a decent amount of money.

Be aware of the law. As a general rule, the laws around a landlord-tenant relationship are mostly common sense. You must understand where the rights and responsibilities of each party lie, though, to avoid problems with your tenants; familiarise yourself with the basics of landlord practise in our guide to becoming a landlord, so that you can prepare your property, attract tenants and conduct a tenancy with confidence.

Becoming a hands-on landlord isn’t for everyone, but as the Government continues to pressure the Buy to Let sector it’s becoming more and more important for landlords to save where they can. Though the efforts involved in handling a property yourself are greater than hiring a property management agency, the cash you save could be well worth it