Top New Year’s resolutions for landlords
12:20pm Thursday 10th January 2013
1. Make time to talk
Although we all know that good communi-cation is essential to any relationship, most of us are guilty of periods of mis-communication – or sometimes no com-munication at all. Make 2013 the year that you talk (and listen!) to your tenant.
Good communication between a self-managed landlord and tenant is vital. Depending on the time in the tenancy, or indeed the time of year, there are a number of things landlords need to tell their tenants – and having a relationship based on good com-munication allows you to deliver these key messages with ease.
For example, you might need to tell your tenant to keep the heating on low while there’s frost on the ground to prevent your pipes freezing. It’s good to keep the channels of communication open so you can find out about the property itself too. If a tenant is simply left to get on with it, it’s impossible for you to know what’s going on in your property.
2. Pay a visit
Regular inspections are important for both the landlord and tenant.
An opportunity for landlords to assess the treatment of their property and review any necessary updates and repairs, inspections also give the tenant a chance to raise any problems or concerns.
If you’re self-man-aging your property, you really should visit the property every six months as a minimum.
The time for this visit should be pre-arranged with your tenant and confirmed in writing where possible.
A visit to the property is the only way to get an accurate picture of what’s going on in your property. Just because someone’s paying rent on time every month and isn’t hassling you it doesn’t mean everything is all right.
3. Rapid repairs
Are you guilty of delaying repairs and not responding to maintenance issues quickly enough? When maintenance issues are report-ed, act swiftly in order to avoid long-term damage to your property and, ultimately, the bigger price tag that this is likely to carry. It’s your property and you are respons-ible for it and for maintaining the value of it. Even minor leaks can turn into something quite serious if ignored.
As well as helping to maintain the fabric of your property, a speedy response to maintenance problems is beneficial for your tenant as well. Not only will it increase their confidence in you as a landlord but it will also possibly encourage them to stay longer.
4. Financial review
Do the figures add up? Review your outgoings (and your incomings) to ensure that your finances are working for you as efficiently as possible.
It’s a good idea to sit down with your paperwork at least once a year to identify if anything can be streamlined. Would you benefit from a better mortgage rate, for example?
There are buy-to-let products coming on to the market all the time, and there are some great deals currently available. Another major area to scrutinise is the bills and invoices from contractors that do any work on the property. Whether they are plumbers, electricians or handymen, are they charging fair prices for the jobs they are doing?
Likewise, assess your insurance costs. Are your provider’s prices competitive with others? If not, could you negotiate a better deal?
While evaluating any area of your finances, always remember that although it’s usually good to cut costs it’s never good to cut corners!
In addition to assessing what’s going out of your bank account, think about incoming revenue as well. Is the rent you are being paid the correct amount for the property? Is it time for an increase?
An annual increase of four or five per cent, depending on the local market, isn’t uncommon, but be careful not to jeopardise a relationship with a good tenant by unjustified rental increases.
If you’re unsure of the current rental value of your property, ask a specialist letting agent for a valuation. And if you’re not going to put the rent up, let your tenant know that too.
5. Refine your timeline
Have you got a long-term plan? When are you planning to sell your rental property and what is your exit strategy? Refine your timeline now in order for you to exit in the most effective way and maximise your profit on resale.
It’s extremely useful to have a well thought out, long-term plan – and if you haven’t already got one now’s the time to make one.
In order to do this you should have a firm idea why you’ve got the property and what its function is – is it for retirement planning, is it for income or is it to pass on to your children? Always know what you want your investment to achieve.
As part of this plan you should also know when you’re intending to exit and how you’re going to do that. For instance, there’s no point buying a property for capital growth with a plan that says you want the money out next year.