The way to combat this is for all new landlords to take some responsibility and be determined to operate their lettings to high professional standards.
- 20 years ago landlords numbered in their tens of thousands, whereas today almost two million private landlords own 4.9 million properties - The number of buy-to-let properties is expected to grow by a further million over the next five years - The current value of buy-to-let properties is estimated at just short of £1 trillion - £989bn Surprisingly, the financial crisis has not slowed the growth of buy-to-let - some of the fastest growth years have followed the banking crisis of 2008-09. Of all the new homes built in recent years, a large proportion has ended up in the private rented sector. Of the 5m homes built between 1986 and 2012 Government figures show just over half are owned by buy-to-let landlords. Most experienced landlords will tell you that investing in property can be a lucrative business. With steady capital growth and a regular rental income it’s a great way to safeguard your longterm investment and even pass on wealth to the next generation. However, like most business opportunities, investing in buy-to-let may not be all plain sailing, and if you want to make a success of the venture then you must be prepared to do your homework and for some hands-on management – buy-to-let is not a passive armchair investment.
Location is important. Where you buy is as important if not more important that what you buy. You must ensure that there is good tenant demand and ideally your properties should be within a short distance from home. Doing thorough research on the local lettings market and your potential returns on investment is crucial. Often new landlords are far too trusting and unaware of the problems that some tenants bring with them. Careful screening of tenant applicants is a very important part of being a successful landlord investor. If you intend to use a letting agent, make sure you choose one with a good local reputation and one that’s a member of a recognised professional association. If you intend to be a hands-on landlord, managing tenancies yourself, you need to learn to manage professionally: read up on the rules and regulations, keep your property up to modern safety and amenity standards, and always respond quickly to requests for maintenance and repairs. Treat your tenants as customers and as you would expect to be treated yourself. There are few investments like property which offer you the opportunity to make quite the same money with so little time and effort on your part, if you get yourself organised. But don’t fall into the trap of thinking you can do it with no work; no mental effort or careful planning on your part. Tom Entwistle is Editor of LandlordZONE® and an experienced landlord himself. ⌂
The private rented sector has been coming in for a fair amount of criticism recently, mainly as a result of a small minority of rogues in the industry, both landlords and letting agents who quite frankly are ripping off their tenants.
LANDLORD INVESTOR February 2015
As a result of this there’s the constant threat of more rules and regulations which governments impose on the industry. From agent redress schemes and landlord licensing through to zero tolerance on retaliatory evictions, there’s likely to be more bureaucracy to contend with in the future.
Published on Feb 2, 2015
In this issue, we cover Kent's buy to let hotspots as Kate Faulkner analyses the local area and it's investment opportunities. Marie Parris...