Name – Pat
Age – 58
Location – Surrey
Full Time Landlord – 15 years
Properties – 1 in Cobham
What are your very first steps before letting out a room or property?
Contacting letting agent to gauge market rent achievable and then doing a gross to net yield analysis to determine the net cash flow impact. This assumes you already have a buy to let mortgage in place.
What kind of costs can you typically expect to incur when letting a property?
Financing/Mortgage costs and professional fees ( AST), Marketing ( letting agent fees) costs, void periods, insurance, maintenance costs and inventory costs ( pre and post tenancy). Taxation impact. The interest deduction rules have changed dramatically so you only get 20% of your interest costs allowable as a tax credit against tax for the tax years 2020/21 onwards.
How do you find the best way to manage repairs and maintenance?
Do it myself as a full-time landlord.
What do you do if the tenant doesn’t pay?
Go through the eviction process.
Any advice for aspiring landlords?
Be realistic on achievable rents and likely costs. Factor in void periods between tenancies, make sure you vet the financial viability of the potential tenant (can they afford the rent?) and have a proper AST and deposit retention agreement signed and in place. Remember being a landlord is not about making money on the rental, it’s all about the capital appreciation on the property and leveraging your property equity to the maximum.