Landlording can be a good and profitable business for anyone looking to start a new business venture, or just wanting to earn extra cash. But, if you’re thinking now that it is an easy job, think again!
According to Telegraph UK, the number of landlords in the United Kingdom ranges between 1.2 to 1.4 million and still growing. Despite the growing number of landlords in the country, the complications that come with the job are not easy to deal with. British people wishing to embark in this type of job need to be persistent and determined to overcome the challenges that come along with the hard-earned cash they get in return.
Dealing with erratic and unacceptable behaviour inside a rented property is a common issue. In addition to this, a landlord also needs to deal with managing the rental income and taxes. According also to an article by Richard Dyson in The Telegraph, less than 500,000 taxpayers in the United Kingdom that are HMRC-registered are taxpayers declaring their income earned from property rentals.
Now that you’ve heard about these pressing issues, do you think you’re still up for the business of landlording? Do you think the challenges in the business can make or break you? Do you think you have what it takes to be a good landlord?
Set up reasonable rental rates
When buying a house that you wish to rent out, choose the amount of money you are willing to shell out that is comparable to the rental rate that you are going to set. Being fair to your potential tenant is the prerequisite to a harmonious landlord-tenant relationship. If you and your potential tenant cannot agree to a rental amount, how can you expect that the two of you will reach compromises on other things?
On the other hand, when letting residential or commercial properties, your tenant is generally required to be bound by a fixed rental amount for the initial terms – usually 6 or 12 months.
Usually, a good strategy is to set a rental amount which is very slightly below the going rate for the area (market rent), that way you are more likely to let quickly and avoid a long void period with no rent coming in.
Be clear in explaining the rental terms and conditions
Upon reaching a mutual agreement on the amount of rent, you and your tenant discuss the terms and conditions inclusively indicated in the written tenancy agreement. It is no surprise that tenants generally ask questions when discussing the contract. By law in the United Kingdom, your tenant has the right to have a contact address for the landlord or his agent.
By law, landlords are required to entertain and answer these questions. Expect personal questions to crop up from time to time from your tenant. Explain in detail the contents of the contract. Make sure that you and your tenant understand what each other’s message is when discussing the rent’s terms and conditions. Misunderstandings and confusion are the frequent causes of legal disputes between the landlord and the tenant.
To excel in the business of landlording with residential and commercial properties, you should not be shy when communicating with your tenants your expectations from the other party as indicated in the contract. Do not be too sensitive and afraid of offending the other party. You should take authority as a landlord and speak your mind, making your tenant aware of the transactional do’s and don’ts.
Be on guard when ensuring utility safety
As a landlord, you should care about the welfare and safety of your tenant. Before renting you need to make sure that your property’s utilities supplies such as gas, electricity and fire systems work properly and are safe to use. By law in the United Kingdom, as a landlord, you are responsible in certifying the utilities safety.
Make sure that the gas equipment is safely installed and maintained by a Gas Safe registered engineer. Make sure that your electrical systems and appliances are operational and are safe to use. Your fire alarm systems must work when emergencies occur. Your furniture must be fire-safe. Finally, make sure to alert your tenant on where the cut-off values and fire exit are in case of emergencies.
Be objective when settling disputes
Tenant eviction happens when disputes are not settled compromisingly and objectively. When you are having a disagreement with your tenant, take a deep breath and analyse the situation. Hear out your tenant’s argument before putting forth your own argument. Try to see the situation through your tenant’s point of view, if you think his argument is making sense. Try to reach a compromise favourable to both you and your tenant to avoid getting things ugly and losing your tenant.
The creative skill in online advertising
Unfortunately, there comes a situation sometimes when you lose your tenant. Do not give up on your business even if this happens. Landlords should learn how to market their place to collect future tenants that they can shortlist for rent. The digital age has evolved in recent years. Advertising online has never been easier. Take advantage of the situation and expose your commercial properties business online, and watch the incoming stream of future tenants for your commercial properties.
Online advertising and blogging allows you to rev up your business and get the best exposure at the cheapest price possible. You get to easily target your desired potential tenants in the centralised online platforms accessed by people from all walks of life. And, the best part is you get to do this at a fixed reasonable price, or maybe even for free. Many advertising websites provide, low or even a free service to advertisers. Finding these sites is just one click away in Google.
Secure the tenant’s deposit
In the United Kingdom, by law, you are required to place your tenant’s deposit in one of four government-recognised tenancy deposit protection schemes. Clearly indicate this requirement on the online posting of your rental advertisement and refer to it in your written agreement both to comply with the law and to avoid confusion and misunderstanding. Many tenants still forget how the rule of law works. Additionally, many tenants also overlook doing research on the overall legalities of renting.
Help tenants deal with neighbour’s disturbing behaviour
As a landlord, you would not want your tenant to have an uncomfortable living experience at your property, right? Of course, you would be more than willing to help settle disputes between your tenant and his neighbour. Undesirable behaviour in the neighbourhood, such as playing loud music late at night is a common problem. Let your tenant know that you care by being the middleman between your tenant and his neighbour when disagreements arise. Try to talk things out peacefully to resolve the situation. If every resolution fails, report the issue to the environmental health department at your local council to try to resolve the issue.
Be punctual in attending to repairs and maintenance needs
Of course, to make a good impression on your tenants, you should always be prompt in responding to their needs. When their tap is leaking, you need to fix the situation right away by dispatching a plumber to your tenant. Do not wait for your tenant to raise complaints about you for being slow in responding to his needs. Negative impressions can sour things without you even realising it.
Make use of technology
Internet marketing has provided landlords with increasing opportunities to find desirable potential tenants to do business with. Through the use of online marketing tools, as a landlord, you get the option to choose among potential tenants who can possibly be compatible with the method you employ in doing your business. In the long run, your chances of finding the right tenant to build a lasting professional relationship with likewise increases.
Article Courtesy of: DMCI Homes