Posted on April 11, 2017 at 12:30 pm by BeeMyMinder
Money saving tips for landlords
Despite the rise in stamp duty for investors in the buy-to-let market, many still see property as an extremely attractive investment. However, the costs can soon start to rise, especially if you’re a first time investor.
This month we’ve created a list of money saving tips for landlords, ideal for first-timers and serial-buyers alike. These are our recommendations and if we’ve missed anything out, we’d love to hear your thoughts in the comments section at the end of the post.
Choose your insurance carefully
There are so many insurance policies available on the market at the moment it can be hard to choose which is going to suit you as a landlord.
One of the best pieces of advice that we can give is to take out a landlord liability policy and/or landlord rent guarantee insurance policy.
- Landlord liability – this policy covers you up to a certain amount (anywhere from £2 million to £5 million) should you tenant become ill or injured if you haven’t properly maintained your property
- Rent guarantee – this is essentially what it says on the tin. It guarantees you a monthly income even if your current property isn’t occupied.
Remember to do your research before taking out a policy. It needs to fit your current circumstances, so make sure that you read the Terms and Conditions carefully.
Second hand is more cost effective
We’re not talking about a second-hand flat now; we’re talking about the furnishing that you choose for your property. If you’re going to be offering your property as fully or semi-furnished, then why not use quality, second hand furniture instead? (Make sure they are fire safety compliant though).
Remember who your target tenants are going to be. For example, if you’re going to be renting out to students, then they want the house to be comfortable and furnished, but aren’t going to be as concerned about high-end, designer furniture.
For young professionals, they may like their flat to be modern without being too stark, and families will usually have a lot of their own furniture, so consider offering unfurnished.
Store your policy documents in one place
It pays to be organised when it comes to your important documentation, especially if you have multiple properties and tenants.
Compare the market (for trades people)
With any investment property comes the eventual repairs. From boilers to kitchen cupboards, leaking radiators to shrinkage in new builds, you’re always going to have to make repairs.
When you’re trying to find the right trades person for the right job, it’s worth checking websites such as checkatrade.com for the nearest and most qualified trade.
If you’re not going to be using a website such as checkatrade, then make sure that any decision you make isn’t just made on the cheapest price. We’re not saying that the cheapest price is always the worst, but you must have heard the phrase “you get what you pay for”.
One of the best ways to make a decision is to ask for a referral. Most self-employed trades work on word-of-mouth, so if you know someone that’s had some work done recently, ask them about their own experiences.
Visit our friends at the Tenants’ Voice, they have heaps of reviews too.
Review your mortgage regularly
If you already have investment properties then you’ll know that the landlords’ mortgage is going to be one of your biggest expenses. You need to make sure that you’re reviewing your mortgage on a regular basis to ensure you’re getting the best possible deal.
In some instances it might be better to switch to another mortgage before the current term ends; there can be long run savings to be made if you watch the market and act quickly.
Haggle over price when you’re investing
If you’re a cash investor, you’re going to be in an excellent position when it comes to negotiating the price of your property. This holds especially true when you’re buying from a New Build developer.
If you’re familiar with the new build market, it’s important to time your offer right. Many developers have half-year and year-end targets that they need to achieve, so this is prime time to receive a discount on your potential investment.
There we have it, our top tips for reducing your costs as a landlord also goes out to all the lenders out there.What do you think? If you’re a landlord, how do you manage to maintain your costs at a reasonable level, without compromising the quality of your rental properties?
As we’ve already said, we love to hear thoughts and experiences from our readers, so let us know in the comments below. Likewise, you can give us a shout out on social media; you can find us on Facebook here, or on Twitter here.
If you found this post useful and want more information on how to stay on top of your organisation, why not take a look at this article we wrote with our top tip.