Making the most money from your rental property
View PDF | Print View
by: DougWalker
Total views: 24
Word Count: 531
Date: Thu, 15 Sep 2011 Time: 1:23 PM
There has been a tremendous growth in the number of private landlords in the last ten years. Many people have come into the business with no experience, hoping to make a lot of money. Some have succeeded but many have been unsuccessful and lost their savings as a result. How can you avoid the pitfalls of the buy to let market?
Firstly, try to buy in an area that you are familiar with. If you live in south London it makes sense to start looking for investment properties in south London. You'll know the good areas and the bad ones, you'll be able to check out the transport links and the local amenities and you'll be able to get to your investment property rapidly if something goes wrong.
When you are renting out your home to strangers you need to ensure that you make a very clear list of what your property contains. You of course want to avoid any difficulties or disagreements at the end of the tenancy so it's crucial to make a list of all the items and furnishings that are in your house. This is called an inventory. It's an vital part of your toolkit as a buy to let landlord and it's something that you cannot do without if you are planning to rent your property.
Basically an inventory is a list of all the goods in your home, along with a thorough description and a comment on the condition of that item. For many landlords this will be a short list, but of you are renting the house in a furnished state you may need to document many different items and you may need to take pictures of the higher value possessions for Insurance purposes.
Once the inventory document has been finished it needs to be signed and dated by the landlord and the tenant and kept in trust with the tenant's deposit. It's vital that this is done correctly as it will provide the legal basis for any compensation claims you may make in the future.
If you can't buy in an area you know then ensure you do your groundwork. Local newspapers and estate agents are a good place to begin to look for information. Ensure you check the prices carefully and monitor to see how long it takes for properties to sell. You will need to know precisely what rental income you can attain before you commit to anything because if the sums don't add up you will end up losing money.
Lastly, many people have lost out in the past because they didn't have the right type of buy to let insurance. It's vital that you get the right cover as, if anything goes wrong, you need to be sure that your investment is protected. Some insurance policies are marketed as Landlords insurance policies, but they are the same thing. A good policy will provide you with all the usual buildings and contents cover and also cover you for things like loss of rent and legal expenses. It costs a little extra but in the long run it could save you a lot of money.
About the Author
Doug Walker Dip CII is General Manager of Academy Insurance Services Ltd. Academy is an independent insurance broker specialising in niche insurance markets such as blocks of flats insurance and buy to let property insurance.
Rating: Not yet rated
