Installing new bathrooms, laying down the real-wood flooring and adding granite surfaces and mod-cons to your kitchen… Read any guidance on renting to a more mature market and you will be flooded with ideas about how to add the best finish to your property. But as a professional Landlord, are you really considering risk of what these touches could cost you?
Invest in your property for your market
The problem is that it’s all true.
As a professional Landlord your property is your only marketing tool and that makes things difficult. All of a sudden in order to appeal to a specific market you need to invest in your property. If you want your home in North Norfolk or East Devon to appeal to wealthy adults, you may find yourself choosing from bathrooms designed by Villeroy and Boch rather than Wickes.
We could put this down to taste. As a Landlord you are investing in items that will appeal to a mature market; even items that would look great posted on your tenant’s Pinterest account. You may even picture your tenant enjoying the sunset through their bay window from their Italian settee.
What’s more is that Landlords presume there’s less risk than renting to Students and Young Adults. With adults over 35, their home is their castle and long-gone are the after-club parties. With this in mind you would happily spend more to keep your tenant’s in the style and quality they would like to afford.
Risks of over-investing in your property
This goes against conventional thinking. But the key is to realise that when something does go wrong; if your property is damaged and your designer drapes gets damaged, it could end up being very expensive.
The first thing to realise is that as your investment increases, so does your risk. When we compare our claims data against the 2011 UK Census, we see that the average claim made rises as the proportion of adults grows. Put simply, if you rent your property to people over 35, you could expose your property to larger risks.
And it’s not just price…
Price of your purchases is not the only factor in determining how expensive a claim could be. When picking a piece of furniture or utility, consider the following:
• The likelihood of damage to the item
• The cost of damage from a fault
• The cost and availability of repair, maintenance and replacement
• The potential cost of labour
• The income lost in rent
Think if the boiler went, what are the conditions on your warranty? Would the manufacturer have to send a technician? And what is their response rate?
Our Tips for Landlords to help reduce the risk
The key is to assess these risks properly before making investments: balance, your costs, risks and the potential income something could earn you. Here are our top-tips that you may want to consider:
• Local suppliers and labour may be more costly but they are often more available and reliable in times of emergency
• Custom and fitted units with wooden or fragile surfaces can be damaged easily and warp when exposed to excess moisture
• Always be aware of warranty and guarantee conditions of all items in your properties
• Always treat your purchasing decisions professionally
• Insure your property with the relevant cover in order to take care of any eventualities
Ultimately, your property is your business and it’s very important to treat all decisions about spend, investment and risk suitably. Over-investing could leave you at increased risk, but under-invest and your risk the coveted tenant finding your property unappealing. As a Landlord you will face tough decisions, but you have our support and can always rely on Simple Landlord’s insurance.