Ten things every landlord must know
We serve hundreds of landlords and tenants across the East Midlands and take enormous pride in our reputation for looking after our clients. Over many years running a lettings and property management agency there’s not much we haven’t experienced. In this guide, our HM Lettings manager, Stephen Reade shares the top ten things that every landlord, regardless of the size of their portfolio, needs to know and understand.
1. Choose your agent very carefully
Although this sounds obvious and simple, it is probably your biggest and most important decision. Look at the agent’s track record and ask to speak with landlords they currently work with. Don’t be shy about asking which industry organisations they are members of, such as ARLA (Association of Residential Letting Agents) and the Client Money Protection Scheme. If things go wrong and your agent can’t or won’t pass your rent on to you, you could end up losing that money without this vital protection. Ask to see copies of their insurance policies for added assurance.
As well as choosing a professional agent with experience, ensure you also get along with them. This is essential to ensure a long and mutually beneficial working relationship.
2. Price your property competitively
Your property will need to be priced competitively in order to attract applicants. Most agents, including HM Lettings, will give a free valuation and as part of that, they should be doing a market comparison. Ask to see other examples of similar properties to ensure this has been done and the price is right.
3. Be ready for unexpected costs
Budget for unexpected spend on the property such as broken boilers, accidental breakage and weather damage. Another potentially unexpected cost to prepare for is void periods which could range from a week to over a month. A good idea is to have a separate savings account where money towards maintenance and improvements is saved as well as up to 4 months’ worth of rent in case of void periods. As HM Lettings is part of The Nottingham Building Society we can help you along your journey to achieving these savings. Visit our website to take a look at our entire range of savings accounts.
Landlords who do not have the finances in place to survive void periods tend to be under more pressure to let without properly vetting tenants. This could lead to missed rental payments or damage to the property which will cost you more in the long run.
4. Get covered - stay informed
To protect your investment it is always best to have the correct insurance. This will typically include buildings cover, rent and legal protection and contents cover if your property is furnished. Rent protection will pay rent when the tenant defaults and a good legal protection policy will cover against virtually any legal dispute with your tenant. In our experience this is money well spent.
5. Take out a boiler cover policy with an established provider
Besides the assurance of one cost per year covering parts and labour, you can be assured of a prompt response at all times of year. Independent contractors are often in high demand when the weather turns cold and might not be able to attend for several days. This could lead to complaints and even compensation claims from tenants.
6. Choose expert gas and electric engineers
When getting your gas and electric safety checks done, carefully consider your choice of company. Always try to use someone that has been personally recommended to you, or make sure that you do some research to ensure that you’re employing a reputable tradesman or company. Your lettings agent, such as HM Lettings will be able to help you find the best people for the job.
7. Cheap and cheerful?
When carrying out repairs/refurbishments, don’t automatically choose the cheapest options. Poor quality materials can have a shorter lifespan and could cost you more in repairs and you could have to replace things earlier than planned. It can be more economical to go for better quality materials that will last considerably longer and prove a wiser investment.
8. Be available and communicate
Maintaining good communication with agents and tenants can avoid or limit most landlord/tenant issues. Ensure that they have your up-to-date contact details or that the agent is readily available so problems can be addressed quickly and efficiently.
9. Take time to understand your tenancy agreement
Check that the tenancy agreement is appropriate to your property and your circumstances. If you have any questions a good letting agent will have no issue in answering them and being fully transparent. If you are planning to deal with your tenants directly, try to meet them before signing on the dotted line. It’s important that you feel comfortable with the long-term relationship you are about to embark upon. If you are happy with the judgement of your estate agents on this front then make sure that they are also happy to vet the tenants on your behalf.
10. Choose legal advice wisely
Pay attention to the legal side. The industry is becoming very heavily regulated so it is vital you are aware and well informed. When engaging a lawyer for legal advice, ensure that they have in-depth knowledge of this specialised industry. Do your research and again ensure that you are getting recommendations on the people that you are employing for these very specific and important regulations.
HM Lettings is part of The Nottingham which also includes Nottingham Building Society and Nottingham Estate Agency and Harrison Murray.