I have thought for some time that I ought to focus a Blog on Property Development and Rental, the reason being that our company supplies a lot of property developers with doors when renovating their properties. In addition, I have personal experience in property development, having renovated many properties, which are on long-term rental.
As a private landlord I see both sides of the rental coin. From my viewpoint it is something I enjoy, particularly the renovation phase and renting out some of the properties has been the best solution when selling didn’t make economic sense, particularly over the last decade. The tenants viewpoint is often diverse, ranging from not wishing to buy at the present due to job location which may be temporary, or property in their preferred area is unavailable but schools are good or they may find that renting is economically better than buying at a certain stage in their lives. Some of my tenants wish to buy their own properties but over the last few years have not been able to get mortgages. One thing is clear; Private Landlords have provided accommodation for the growing numbers who, for what ever reason, have not wanted to or are unable to purchase their own properties.
It is important that you do your homework before embarking into being a private landlord. Landlords have legal responsibilities, particularly to provide safe accommodation. Its not a matter of buying a cheap property, giving it a lick of paint then having someone else pay the mortgage for you. Properties have to be sound, well maintained appealing to tenants and the paperwork must be kept up to scratch. There is a lot to consider and organisations such as the Residential Landlords Association (to which I subscribe) offer the correct information to you with online templates for the documentation process. In addition, through their news magazine and e-mail they keep you updated on new legislation and related topics.
What makes a successful residential investment? There are important points I consider:
Timing is of primary importance both for purchasing and when renting
Research into the area you are buying into is worth serious consideration
Homework into what renting entails e.g. tenants credit worthiness, taking deposits, Energy Performance Certification etc.
Practical Knowledge of properties is very useful or the ability to use reliable trades people. Keep accounts of what you are spending and consider what happens when repairs and breakdowns occur.
I always look at the property from the tenant’s viewpoint would I be comfortable living in the property and what are the basics I would require?
There is no guaranteed formulae for success or long term financial prosperity but start small, consider the pitfalls, be sensible don’t put too much into a property if the good basics is all that’s required for the type of property.