Blog
- Details
- Hits: 4
If you’ve just inherited a rental property, then you may be wondering what your options are.
While you won’t need to make any decisions on the spot (it usually takes many months to settle an estate), it’s good to start thinking about the issues you’ll have to address in time.
The first is what you intend to do with the property. Assuming you don’t want to move in yourself, your options are to:
- Continue to rent the property out. That way, you’ll earn a monthly income and have a long-term investment that you could later pass on to your family.
- Sell the property and use the funds to pay debts, invest or spend how you wish.
Let’s look at what each scenario involves.
Renting out an inherited property
It’s important to understand that there’s more to being a landlord than simply collecting monthly rent.
You must follow hundreds of rules and regulations and ensure your tenants have a safe place to live.
Don’t be intimidated by this. Many accidental landlords – that’s the term for people who become landlords through circumstance rather than design – go on to stay in the private rental sector long term.
But especially in the early days, they get a letting agent to manage their property instead of jumping in at the deep end and drowning in red tape. Having an experienced professional onside to help you learn the ropes can be a lifesaver.
A good letting agent will explain how to inform your tenants that you’re the new owner. (You can’t turn up onsite unannounced.)
They’ll also advise you about landlord insurance, maintenance and buy-to-let mortgages (if applicable).
Selling the property
If you choose to sell, you must decide whether to proceed with the tenants in situ or with the property as a vacant possession*.
There are pros and cons to each of these options.
Conducting viewings can be more complicated with tenants in the property. You need to notify them 24 hours in advance of a viewing, and they can refuse.
And some buyers prefer a vacant property so they can move in on day one without any restrictions.
However, a tenanted property can be an appealing prospect for a landlord looking to expand their portfolio, especially if the tenant is long-standing and reliable.
Also, it means you can proceed with the sale faster as you don’t have to navigate the eviction process.
Don’t rush your sale
You may be tempted to offload to a quick-buy company that offers to take the property off your hands with little fuss.
Be aware that if you go down this route, you’ll most likely get far less than you would by going with a traditional estate agent. While you may feel tired and emotional right now, you might regret short-changing yourself later.
Tax implications
Whether you opt to keep or sell the property, speak to a good accountant or financial adviser.
They’ll explain the inheritance and capital gains tax implications of your decision. And if you rent the property, they can also advise on the most tax-efficient strategies regarding income tax.
If you’ve just become an accidental landlord, contact us here at Gibbins Richards Lettings and Management Ltd. We’re here to help.
*Note: You must follow strict procedures to evict the tenants; these rules also apply if you plan to move into the property yourself.
- Details
- Hits: 42
There are five fundamentals to consider when thinking of buying a rental property.
Whether you’re a seasoned investor or taking your first step into the rental property market, make sure you understand what makes a place a good investment.
Here are five points to consider carefully:
Location, location, location
The age-old mantra is as relevant as ever. A property’s location can significantly impact its desirability and, consequently, its value. Look for areas with strong growth potential, good infrastructure and accessibility to amenities like shops, good schools and public transport. Up-and-coming neighbourhoods or those in the regeneration process may offer particularly attractive opportunities.
Rental yield and capital growth
A savvy investor knows the importance of balancing immediate returns with long-term gains. Rental yield – the annual rent collected as a percentage of the property’s purchase price – is a key metric for assessing an investment’s profitability. Equally important is capital growth, or the potential for the property’s value to increase over time. Researching historical price trends in the area can provide insights into future growth prospects. A good estate agent can help you with this.
Property condition and maintenance
The state of the property can significantly influence your investment’s success. A well-maintained property can attract higher rents and more reliable tenants, reducing the likelihood of costly repairs and vacancies. Consider the property’s age, the condition of significant things like roofing and plumbing, and any immediate renovations required.
Market demand and tenant appeal
Understanding the local rental market and what tenants in the area are looking for can help you choose a property that stays in high demand. Factors such as the property’s size, layout and features should align with the preferences of your target tenant demographic, whether they’re students, families or professionals. Again, this is an area of your research where an experienced local estate agent can be of massive value to you.
Financial considerations beyond the purchase price
The initial cost is just the beginning. When calculating the overall investment, savvy investors factor in additional expenses such as tax, insurance, management fees and maintenance costs. Being mindful of these outgoings ensures you have a realistic expectation of your net return.
Property investment requires a considered, strategic approach informed by careful research and a clear understanding of your financial goals.
Working alongside trusted advisers like mortgage brokers and estate agents can improve your chances of success.
By focusing on these five fundamentals, you’re not just buying property but investing in a future of potential growth and income.
Get in touch with us today if you have any property investment questions.
*Disclaimer: The information in this article does not constitute legal or financial advice.
- Details
- Hits: 48
Maintaining a rental property isn’t just about collecting rent; it’s about safeguarding your investment and keeping your tenants happy and safe.
That’s why regular property inspections are so crucial.
They help you spot potential issues before they become costly repairs and ensure your property remains a place people are proud to call their home.
Here’s the lowdown on the five key areas you need to focus on during your inspections:
Structural integrity: Let’s talk about the ‘bones’ of your property. Look for any cracks in the walls and ceilings. Also, checking the roof for missing tiles or leaks is a smart move.
Plumbing and electrical systems: No tenant wants the surprise of a cold shower or a flickering light. Give all your taps, toilets and pipes a once-over for leaks or signs of corrosion. Light fixtures and wiring must also be safe to prevent potential hazards – it’s the law.
Heating and insulation: Ensure the boiler works efficiently and the radiators do their job. Proper insulation is key to keeping the heat in, the energy bills down and your tenants happy.
Safety equipment: This is about more than ticking boxes – it’s about ensuring your tenants’ safety. Smoke detectors, carbon monoxide alarms and, if required, fire extinguishers need to be in top working order and up to date with the latest safety regulations.
General wear and tear: A bit of damage is expected, but you’ll want to watch for anything that’s gone beyond ‘a bit’. Damaged fixtures, broken flooring and any changes made without your permission should be on your radar.
Remember, as a landlord, you must adhere to many rules and regulations that constantly change. These include several laws around property inspections.
The good news is we can help take that load off your mind and handle all inspections, tenant relations and property management for you.
By staying on top of these five essential checks, you’re not just keeping your property investment in pristine condition but also building a solid, respectful relationship with your tenants.
What’s not to love about that?
Thanks for reading. Contact us today to find out more about our property management services.
- Details
- Hits: 60
Planning to renovate your rental? There’s one thing you should know before you start pulling up carpets or ripping out cabinets.
It will help you avoid a costly and avoidable mistake that many landlords make, and it’s this.
Don’t let your emotions cloud your decision-making.
It sounds simple, but you’d be surprised how many landlords lose sight of the fact that they’re supposed to be making business decisions. As a result, they do one or more of these things:
- Spend more than they need to.
- Spend cash in the wrong areas.
- Wind up with a longer void period than necessary.
- Do a sub-standard job that requires repairs.
- Put off doing much-needed work.
Here are some tips to help you stay on track.
Identify your market – Don’t decorate to your personal tastes. Consider who will most likely rent your property – students, families or professionals – and renovate to suit this demographic. A bespoke kitchen might be justified if you’re targeting wealthy professionals, but not if you’re renting to students.
Neutral tones – If you’re yearning to make a bold interior design statement, do it in your own home, not your rental. Prospective tenants may not share your tastes and could be put off by your aesthetic choices.
Go beyond the cosmetic – Do the locks need fixing? Are the fences wobbly? Does the boiler need replacing? It can be tempting to blow your budget on sexy, eye-catching features, but don’t overlook the basics.
Family matters – If you have a strong emotional attachment to the property (perhaps it was your former family home), don’t let sentiment misguide you. You must separate any nostalgic feelings from your duties as a landlord.
Be practical – A rental will always be subject to wear and tear, so opt for durable products and steer clear of light wall colours and flooring that will get mucky quickly.
Be realistic – Not even the best tenants in the world will treat the property exactly as you would, so look for low-maintenance solutions. This is particularly relevant if you have outdoor space, as garden maintenance is a common cause of disputes.
Avoid false economies – While some landlords go overboard and spend too much, others don’t spend enough. For example, tiles are easy to clean and don’t attract mould, so it can make sense to tile the entire bathroom to prevent issues from arising.
Don’t be a DIY hero – Instead of paying a tradesperson to do work, some landlords consider it a personal challenge to do as much as they can themselves. This means work can take longer than necessary or it isn’t done to a professional standard.
If you’re a landlord, contact us here at Gibbins Richards Lettings and Management Ltd for advice about investing your renovation budget wisely.
- Details
- Hits: 47
Being a landlord is rewarding, but it comes with its own set of challenges and responsibilities.
Over the years, we’ve seen and helped solve most of the mistakes landlords can make.
To help you navigate this complex terrain, here are the five most common mistakes we’ve encountered and how to avoid them, ensuring a more profitable and stress-free experience.
Neglecting property maintenance
One of the gravest errors is failing to maintain the property. This leads to disgruntled tenants and costly repairs down the line. Prevent this by scheduling regular check-ups and addressing issues promptly.
Inadequate tenant screening
Skipping thorough background checks can land you with troublesome tenants. Conduct comprehensive credit, reference and background checks to secure reliable and responsible tenants. It’s much more professional and less problematic if you get an excellent letting agency to do this for you.
Not understanding legal obligations
A big one. A lack of knowledge about landlord-tenant laws can result in legal woes. Stay informed about your legal duties, including deposit protection and property safety regulations, like gas and electrical laws, to protect yourself and your investment. Again, a good letting agent keeps you on the right side of the complex and constantly changing compliance rules that govern rental properties.
Poor communication
Failing to communicate effectively with tenants can lead to misunderstandings and disputes. Keeping open lines of communication and being transparent about expectations from the outset helps avoid issues.
Ignoring insurance
Landlords often overlook the necessity of having adequate insurance coverage. Ensure you have the correct insurance to cover potential damages, rental voids, legal disputes and liability claims.
The letting agency advantage
To avoid these common mistakes, why not consider the expert services of our letting agency?
We have helped hundreds of landlords navigate the ins and outs of renting out their properties. From finding the ideal tenants to handling day-to-day management, we are here to ensure your rental investment is as profitable and hassle-free as possible.
Contact us today, and let us help you turn your property investment into a resounding success.