Some things to consider if you are thinking of buying a BTL
If you have never been a landlord but have had the idea of having a several properties that produce a regular income is great because it means you never having a regular income and the prospect of capital growth. And even with the overheads and non-benign taxation regime, it seems a great idea in principle, even if it takes some time to get there.
Certainly, the idea of sitting in the sun twiddling your fingers for a living while a bunch of tenants pay you money every month is appealing. And the more tenants you have, the more income you have, and the more properties you have increasing in value. It’s not a bad way to live at all.
However, before you get to that grand stage, there are a few things that you need to learn, not the least of which is that there actually is work (uuurrrgggh! – werk!) involved in being a landlord.
In fact, the very first thing that you need to do is to work, and that means scouring the internet for as much information as you can get about buying a property with the sole intention of letting it. One landlord who now has plenty of experience says that on looking back, it is incredible that he made it through his first purchase. His main mistakes were paying for services he didn’t need and ignoring laws that he didn’t know existed. But he went on to say that the best way to learn is by doing it yourself, and that there are really no “secrets” to being a landlord.
One thing to note is that it is difficult to “time the market”. Ideally, you would want to wait until the market was slow and buy at the lowest possible price, but you might find yourself waiting a long time. A year or so ago, the property market was doomed according to many people, with Covid and so many people being on furlough or out of a job. In fact, the opposite has happened, with property prices skyrocketing in some areas with a hugely unexpected rise driven, no doubt, by the stamp duty holiday. Even that does not exactly make sense as the money saved is small compared to the price increases.
The price increases has put more people in difficulty when it comes to buying a home, and so there are more people who need to rent. However, if you are looking for a quick buck, then being a landlord is probably not the right choice. If you are willing to save up a good deposit and invest in a BTL for long term growth, then that is the right way to look at it. History shows that over the longer term, house prices always increase, but there can be dips and dives as with many other investments.
You need to understand that being a landlord involves making decisions, because you are running a business, and you have to treat it as such. And that includes evicting rogue tenants who don’t pay the rent. You can guarantee that sooner or later that is going to happen to you. And eviction can be a long procedure, so you need to have the patience to deal with it, because the law tends to favour the tenant rather than the landlord.
There are many other issues to consider such as vetting your tenants, making sure they have the Right-to-Rent, ensuring that appliances and detectors are up to spec. There is of course insurance to take care of as well – to protect the property and contents (if furnished) and protecting your rent. You may also want to cover maintenance emergencies, and these can be expensive. Suppose the central heating dies? You can’t just leave it. You have to fix it ASAP. You need to realise that owning a BTL isn’t just about paying the mortgage and collecting the rent. There are running costs involved as well.
Then there is the case of damage caused by the tenant. When your tenant moves in, you need to undertake a written inventory report which will note the condition of everything at that point. This is so that, if the tenant causes unreasonable damage, you can recover the cost of repair from the deposit. An inventory report should also include lots of photos so that there can’t be any arguments. You should take inventory on a regular basis throughout the tenancy and then produce a final check-out report on moving out day.
This will enable you to claim for any damage from the tenancy deposit. However, you should note that you cannot claim for fair wear and tear. Carpets do wear when people walk on them, and that is part of the overhead of being a landlord.
There is a lot more to being a landlord than just this, but hopefully this has given you some pointers. You could just leave it to a letting agent and let them find and vet the tenant, manage rent collection, maintenance and insurance for a fee, but where would the fun be in that?
Panos, 12 August 2021
Post Titles
- Career Spotlight: Be a Property Inventory Clerk
- What tenants can expect from a Mid-Tenancy Report
- What are Periodic Inspections and what do they entail?
- Landlords - What to Do at the End of Tenancy
- What is a Check-In report?
- How inventory clerk software can help your business
- Property Inventory App? What can I expect for my money?
- The advantages of using Voice Technology for Property Reports
- What goes into a Condition Report?
- Things to consider when compiling a Property Inventory
- Do I Need a Property Inventory?
- The Importance of Check-In and Check-Out Reports
- Our App makes creating a Schedule of Condition so much faster and more Accurate
- Our Dictation Software makes creating Inventory Reports so much faster
- Why you need to carry out Interim Inspections of your BTL
- Creating an Inventory is a critical task for a Managing Agent
- An Inventory Guide for Tenants
- Some tips for Landlords carrying out Property Inspections
- Creating an Inventory is one of the most Important Tasks for a Managing Agent
- What should you check for when Inspecting your Rental Property?
- How to Hire an Inventory Clerk
- Is an Inventory Report needed for Unfurnished Properties?
- The Reasons why you should carry out a Mid-Tenancy Inspection
- The Perfect Inventory App for Landlords
- Check-In and Check-Out reports: What you need to know as a Tenant
- Carrying out Mid-Tenancy checks: What you Need to Know
- You’re not still living in the 20th Century, are you?
- What to check for when doing an Inventory Report
- Use Speech Recognition tools to reduce time doing Reports
- Our Dictation App saves you a Huge Amount of Time
- Mid-Tenancy Reports are Critical when Letting a Property
- There may be Errors in the Inventory Report
- Reports2Go: the 21st Century way of creating Property Reports
- How to do a Condition Report for your BTL
- The work of an Inventory Clerk can be exceedingly varied
- What should you check for when inspecting your Lettings Property?
- Some things you need to know about Mid-term inspections as a Landlord
- The Reports2Go App makes Property Reports simple
- Why you should carry out Interim Inspections as a Landlord
- Why Check-In and Check-Out Reports are important for Tenants
- Some things to consider if you are thinking of buying a BTL
- The clever way for Letting Agents to create Property Reports
- Our FREE app makes Inventory Reports so much easier
- What to do if your Tenant has Damaged your Property?
- Inventory Reports and Check-Ins – are both really necessary?
- Who should pay for Property Cleaning - Tenants or Landlords?
- Is a Check-in Report Really Necessary?
- New plans and improved resolution for images
- Overheads of being a Landlord
- It is Critical that Inventory Reports are Accurate
- Mid-term Inspections of your BTL are Essential
- Minimising risks with proper tenant checks
- Making a Claim on a Tenant’s Deposit: What you need to consider
- The Importance of an Inventory for Tenants
- Things to note when conducting Check-In/Check-Out reports
- Our App saves a huge amount of time carrying out Inventories
- 5 Handy Screening Topics for New Tenants
- Busting Property Management Myths
- Six Money-Saving Tips for Landlords
- Rules for Tenants and Pets in 2021 - What are the Changes?
- As a Landlord you need to carry out Interim inspections
- Giving your Feedback on an Inventory as a Tenant
- Inventories made easy with Reports2Go
- New to Letting? What you should know about Property Reports
- Three Pillars of Good Property Management
- How can PropTech reduce your Property Inventory burden?
- Choosing the right Rental Management Strategy
- Some Tips for Promoting your Letting Agency Business
- The Importance of an Inventory to you as a Tenant
- Some Ideas to Consider in Order to Reduce your Overheads
- Legislation Concerning Landlords and Tenants is Constantly Changing
- What’s your Property Management approach?
- How to maintain a Positive Relationship with your Tenant
- How important is a Condition Report?
- Tools for New Landlords and Property Managers
- The Check-in Process in the Reports Cycle
- Doing an Inventory: Part 5 - Enhancing the Report
- Doing an Inventory: Part 4 - Finishing Up
- Doing an Inventory: Part 3 - Describing Items
- Doing an Inventory: Part 2 - At the Property
- How to do an Inventory: Part 1 - Preparation
- All you need to know about Property Reports as a Tenant
- Use the FREE Reports2Go App to Speed-up Inventories
- Using on-board Dictation Software for Reports
- A guide to Inventory, Check-In, and Check-Out reports
- Reasons for Landlords to carry out Mid-term Inspections
- How to Carry out an Inventory Quickly, Accurately, and Easily
- What does an Inventory Clerk do, and should I hire one?
- Inventory – A Guide for Tenants
- Things to keep in mind when conducting a Check-in Report
- Free Schedule of Condition - Why You Need it
- End-of-Tenancy clean? All you need to know
- Reports During Covid - 19 Restrictions
- Mid-term inspections as a Landlord
- How to avoid Deposit Angst with the Reports2Go app
- The Importance of the Reports2Go App for Inventories
- All about the Reports2Go App
- The Importance of an Inventory for a Tenant
- Dictation makes for a much faster and more Accurate Inventory
- How the Reports2Go app works
- Free Property App
- Completely Free App
- Tenant Fees Act and Inventories
- When you have a lot of Inventories, Reports2Go will save you time
- Periodic Inspections and why they are good idea
- Inventory meets the 21st century with Reports2Go
- Our App saves you a lot of time on Mid-Term inspections
- What is an inventory and why have one?
- Text Mode
- Audio Mode
- Our Inventory App
- Inventory Associations
- The life cycle of a Report