Be a Cheryl, not a Nadine
Increased availability of buy-to-let mortgages and rising rental demand has led experts to talk of a new “buy to let boom” and advise investors to home in on housing by becoming landlords - but a leading North East estate agent is warning them to consider the potential pitfalls of going solo.
Figures from theCouncil of Mortgage Lendersshow a 20% year-on-year rise in the number of new buy-to-let mortgages, suggesting more of us than ever before are becoming amateur landlords.
Research by estate agents Northwood however has also shown landlords being left an average of £1500 out of pocket by an annual national bill for rent arrears, vacant properties and maintenance costs in excess of £2bn.
The research also showed 84% of landlords receive less rental income from their properties than they expected.
Ajay Jagota of KIS Lettings, who manage properties for some 700 landlords across the North East from branches in Sunderland, North Tyneside and South Tyneside, advises prospective landlords to think hard before going it alone.
Ajay said: “With savings rates non-existent and the economic outlook so uncertain, investors want somewhere safe to put their cash, and if you want a healthy and reliable return on your money, property is a good bet right now.
“The question every new property entrepreneur faces is ‘do I use an agent or do I do everything myself?’
“The North East’s own Cheryl Cole has shown what you can achieve by going solo – but her Girls Aloud bandmate Nadine has shown solo success in not a sure thing and you can be better off with back up.
“Of course it costs a little more to have an agent on board, but being a DIY landlord is like any sort of DIY – it’s only cheaper if it goes well.”
Ajay advised landlords to ask themselves the following questions if they want to be a Cheryl and not a Nadine:
Will I find a tenant?
“The greatest fear for any landlord is an empty property – no tenant means no income!
“Most good lettings agent will have a list of vetted tenants on their books, and even if they don’t they’ll know how to market your property to secure tenants quickly - including offering advertising you probably couldn’t afford alone”.
Do I know the law inside out?
“Fire regulations; Gas safety certificates; Houses of Multiple Occupation legislation; Deposit schemes; Being a landlord is legally complicated and the relevant legislation and regulation changes from day to day. Do you know enough about property law to ensure you don’t get caught out, and do you have enough time to stay on top of any changes?”
What if something goes wrong?
“Your phone goes off at 4am – your property is flooded. Even if you’re happy being woken up, would you know what to do to fix it? An agent’s maintenance team would.
“The same is true for problems like rent arrears or squatters. If a problem emerges, can you resolve it?
“Being a landlord is a lot to take on - do you really want to take it all of that on yourself on top of everything else you have to deal with? And realistically, could you?
This was posted in Bdaily's Members' News section by Ajay Jagota .
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