The following post is by Amy Bennett, enjoy!
When you decide to become a landlord, there are forms to fill in, contracts to compile and phone calls to make. It can seem like a huge amount of effort and the rewards may not actually seem that large. So, is it really worth it to become a landlord? We assess the positives and negatives to give you a clear idea of whether you are ready to take the plunge into the world of letting.
If you are keen on investing for your future, buying to let could be a great idea. With the current housing market slowly starting to improve, now could be a great time to jump on the bandwagon and get your hands on property. As a future investment it could be a great option as it will cost you barely anything in the long run. With tenants essentially paying your mortgage payments, you will eventually be left with property which you own outright and can either sell on or give to your children when they are older.
Owning property for rental purposes essentially makes you the owner of your own business and therefore the master of your own fortune. You may be able to expand your property portfolio throughout the years and create a successful business for yourself. One of the keys to achieving this success is to be involved in the process and take a key interest in your tenants and property. It is an exciting business and you will feel far more in control if you are involved in each decision.
If you live in a sought after area and are able to charge a high fee for the property, you could be making a large monthly profit. This will allow you to expand rapidly and will give you some extra cash for your piggy bank. The majority of the monthly rent you would receive will go towards mortgage payments and bills that need paying. However, you could still make a small packet on top of this.
There are a number of problems that can occur and that you will have to deal with as a landlord. For instance, if there is a problem within the property such as a leak or a broken appliance, you could be receiving phone calls at unsociable hours. This can be disruptive and you can have to deal with damage control on short notice. Depending on the problem, you may also have to fork out the bill once it has been fixed. You may therefore want to consider the property carefully before you purchase as it could cost you a fortune in repair bills.
There may be times when your property is empty and you are waiting for new tenants to arrive. This could mean that you have infrequent payments and could result in you paying the bills for quite a few months. This is especially apparent when you are completing major structural repairs and cannot have tenants present in the property.
If you are renting to students, you may be able to make a lot of money from renting the individual rooms. However, this can also result in problems as a large number of personality’s means that there can be clashes and you may have to deal with squabbles. They could also cause a large amount of noise, causing disruption to neighbors.
If you are prepared for the difficult yet exciting profession of being a landlord then you will need to consider a number of legalities. You may also want to prepare for breakages, times where you will receive no rent, and any other foreseeable problems. This way you will be far more prepared and it is less likely to end badly.