Help for Landlords to Choose the Right Letting Agents

With new tax changes in 2020 squeezing margins for landlords, it’s becoming more difficult to turn a profit each month. It’s important that rental entrepreneurs protect their bottom line. So here are 7 of the best tips to save money as a landlord.

Save Money As a Landlord Tip 1 # Grab a bargain

Brexit has been causing concern for Brits since 2016. The UK housing market has seen stagnating and falling prices for some time. That’s bad news for landlords wanting to sell their investments. And investors wishing to cash in on lower house prices have been hesitant as prices continued to fall.

However, now the uncertainty of Brexit has subsided somewhat, house prices have risen. Now is a perfect time for buy-to-let entrepreneurs to confidently pick up a bargain. 

Save Money As a Landlord Tip 2 # Smaller properties

Smaller properties make ideal rental properties. Larger properties don’t tend to reap the highest ratio for rental income over property cost. Those that can afford larger homes and higher rents are typically able to buy, so they may only rent for short periods in between selling and purchasing properties. 

They also have steep repair and renovation, and redecoration costs. The exception to this rule are larger properties located close to universities that make excellent rental properties leased on an individual room-only basis for students.   

Smaller properties are easier to get mortgages for and are what many renters are looking for, before they buy later on in life. Smaller properties have lower costs for repairs and renovation.

Save Money As a Landlord Tip 3 # Shop around for the best rates

Lenders are offering excellent rates on mortgages so to be sure to shop around for the very best deals.  The UK base rate continues to remain steady at 0.75%, and it shows no signs of increasing soon. It’s been great news for mortgage customers. Couple this with low housing rates and this is great news for buy-to-let.  

If you are renting small units or student housing as a package with bills included, then make sure you get the best rates. If that means changing electricity and gas suppliers, every six months, so be it. The savings can be substantial. Be aware that if you own a buy-to-let portfolio your business is valued. So, take advantage of any deals that are available. 

Don’t forget to shop around for and switch insurance providers, too. Insurance is a must for landlords.

Save Money As a Landlord Tip 4 # Do work yourself

Many people get into the property business because they like and can renovate homes themselves. Anyone can paint a room. And if parents, grown-up kids, and friends are builders, can plaster, can install a kitchen and bathroom, then you can save oodles of cash. 

When renovating and furnishing, it’s important to make wise choices to save money. If possible avoid carpeting in as many rooms as possible. That way if you need to replace a carpet in a small 10 feet by 12 feet bedroom, it can be done inexpensively. Stick  to hard-wearing laminate flooring in other areas.

Save Money As a Landlord Tip 5 # Avoid void periods

Save Money As a Landlord Tip 5#

Void periods when properties are vacant are a landlord’s worst nightmare as they continue to pay mortgages with no rental income to offset the cost. Use as many strategies as possible to avoid vacant properties. 

That means making your property one that tenants will think twice about leaving. There are several ways you can do this. Make an effort when advertising property to photograph the property well, zeroing on it’s best features. This will allow you to have a greater number of applicants, so you can choose tenants that will stay longer. 

Other ways you can grab longer staying clients is by renting unfurnished properties, that require reasonable moving time and costs for tenants. These tenants stay longer, in general, along with families rather than young professionals that will move locations more frequently. Being a great landlord that deals with breakdowns and repairs quicker is another factor that tenants value. 

Save Money As a Landlord Tip 6# Manage properties yourself

If you have time, then cutting out the agent is one of the best ways to save money as a landlord. Property agents advertise, show, and vet properties as well as managing rent and repairs. But it all comes at a cost. And that can be as much as 20% of the rental value. That’s a huge slice of your profit. These are all things that take time, but can be done by yourself.  

Save Money As a Landlord Tip 7# Choose one paint

Picking one paint for all your properties is practical and saves both time and money. Since you ought to paint rental properties, a standard magnolia, anyway. Using one paint for all properties means that whenever you need to repaint or touch up, you are good to go. If you have separate paints, you’ll need to buy extra paint for each property, which may never be used for touch ups and simply makes life harder. 

Search for deals from stores such as Wilko, Homebase, B&Q, and Wickes. It’s possible to pick up bargains and save yourself over 400%. So when you see an unbeatable deal, stockpile! 

Landlord’s Checklist: Things to remember

If you take on board every tip in this list, you will save thousands over the space of a year. Remember, renting is about more than getting a hefty profit after the twenty-year term of a mortgage. It should be able to provide a profit every month. 

  • Take advantage of low house prices that have dipped to their lowest and are now beginning to rise. 
  • Smaller properties save you money with lower repair costs. Make sure you decorate wisely and keep carpeting to a minimum, 
  • Grab the best deals on low mortgage rates, insurance, and energy suppliers. And use your clout as a larger customer to get further discounts. 
  • Do work yourself and pool skills valuable skills from family and friends who will either work for free or very little. 
  • Avoid losing rental income by keeping optimum occupancy. Choose tenants likely to stay longer and treat them well. 
  • The biggest saving you can make is to manage properties yourself and avoid giving away 10-20% of your rental income. 
  • Renovate wisely, stock up on bargains such as universal magnolia paint. 
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