Taking the plunge and becoming a landlord for the first time is no easy feat, especially in Manchester. Yet as proven time and time again for many investors in the region, utilising property as a long-term method of cash flow can be an outstanding success.
With that said, the private rental sector is subject to so many rules and regulations that even experienced landlords get caught out and make costly mistakes. Whether you’re an accidental landlord looking to flip the situation around, or a genuine first-time investor taking that bold step, there are some terms and general knowledge that needn’t go amiss before you get started.
Here’s what you need to know:
1 Legal matters – There are at least 175 laws that apply to landlords in the UK, covering everything from evictions to electrical checks. You need to be on top of all of them. Claiming ignorance (or that the dog ate your tenancy agreement) won’t get you off the hook if you get caught out.
2 Recordkeeping – It’s vital to maintain a clear paper trail so that if you get into a dispute, you have evidence to support your case. If you’re the kind of person who files important paperwork down the back of the sofa, consider getting someone to do it for you.
3 Vigilance – No matter how nice your tenant seems to be, regular inspections are a must as they allow you to nip problems in the bud. Lax landlords run the risk of discovering that their property has been sub-let, trashed in a series of all-night parties or, turned into a cannabis farm.
4 Take out insurance – We’re not talking about standard home and contents insurance, but specific landlord insurance. (It’s usually a condition of buy-to-let mortgages.) Various policies are available, ranging from top-tier versions that cover almost every eventuality, to no-frills options.
5 People management – Dealing with people is a major part of being a landlord. Most tenants are reliable and honest, but some, unfortunately, can be infuriating. If a tenant falls into the latter category, you need to remain cool-headed when dealing with them. Good landlords make business decisions, not emotional ones.
6 Maintenance – Routine maintenance stops minor issues becoming major structural problems. It helps to have a network of reliable tradespeople who you can call on when you need work done.
7 Tenant selection – Invest time at the beginning of a tenancy to find the right tenant. Never rush the process when it comes to reference and credit checks, no matter how quickly you may want to shrink your void periods. It pays off in the long run.
8 Tax implications – The tax rules covering rental properties have been significantly reformed in recent years. It’s worth getting advice from an expert to ensure you understand what you need to pay and what you can claim back.
9 Understand the market – Successful landlords in Manchester understand the lie of the land, so that when it comes to setting the rent, they are bang on the money. Getting the price right means your property won’t be sitting empty for long periods.
10 Back-up – Good landlords don’t blunder their way through – they have a back-up in the form of a reputable letting agent. If you want support dealing with complicated legislation, handling problematic tenants, and managing day-to-day admin and maintenance, get yourself a good letting agent. Remember, mistakes can be costly.
Property investment and its resulting cashflow are best enjoyed in a hands-off manner; allowing you to maximise your time whilst your properties do the legwork for you. In order to keep on top of each of these components (plus the rest!), having a local, knowledgeable property management company in place is certain to be the final piece to completing your property investment puzzle. For more information on how Abode can help you, give us a call on 0161 883 2525.