Common pitfalls when renting out a property - and how to overcome them
Not treating the rental like a business
Let’s face it – you probably invested a huge amount of money into your rental property. Would you invest a similar amount into buying a new business, without taking it very seriously and having a solid plan for how it would be managed? Of course you wouldn’t. So what’s the difference? Many landlords see renting their property as just an extra sideline, but with this approach, they’ll undoubtedly experience problems sooner or later.
Consider everything from the costs you’ll have to cover, right through to the expertise that you can tap into that will make the process easier to manage. Working with an inventory company in London, if you’re based in the capital, can be a very wise move. This will help to avoid any problems when you’re changing tenants.
Neglecting to carry out regular maintenance and improvements
You might not have to live in the property yourself, but don’t forget that it’s currently someone’s home, and they’re paying you for the privilege. Even a regular lick of paint can make all the difference, and it doesn’t have to cost you a fortune. When you’re planning your incomings and outgoings, this should certainly be on your list.
Keeping on top of maintenance and carrying out routine improvements will not only encourage your tenants to stay longer, but it can also ensure that if the time comes when you want to sell the property, you’ll be in a much better position to strike a great deal with the buyer.
Not increasing rents on a regular basis
It’s important to regularly review the rent that you are charging, and keep it in line with the market levels. Not only will tenants expect regular small increases, but it also takes away the necessity to make large increases which can shock the tenants and cause them to move on.
Obviously, the common question that landlords have is by how much exactly they should increase the rent. Each property is different so there’s no exact answer here, but it can help to keep an eye on rates in your local area to guide your decisions. It’s also necessary to factor in your costs. So if your inventory company has increased the fees you’re paying, or your letting agent wants to take a larger chunk of your income, it could be time to alter your rental price so you aren’t worse off as a result.
These mistakes can be easy to make, but they’re also pretty easy to avoid once you have the awareness and necessary knowledge.