Although many people become landlords as part of an investment strategy or as a way to make an income, some people become landlords unintentionally.
When a person lets out a property as a result of circumstance rather than careful planning, they’re often referred to as an ‘accidental landlord’.
An accidental landlord could be a person who has inherited a property, decided to move in with a partner, or an individual who has to relocate urgently. Some people become accidental landlords when they decide to move house only to find their initial property has decreased in value.
For many accidental landlords, it makes sense financially to let their property to tenants rather than sell it or leave it standing empty.
Becoming a landlord by accident can be daunting, especially if it’s something you’ve never considered before. Thankfully, here at Philip James, our property professionals will offer expert advice for your new landlord venture.
Don’t get attached.
Possibly the hardest thing for an accidental landlord is stepping back from your property. Your old home is now a business property and should be treated as such. Although you have kept your home to an exceptional standard and improved it over the years, you now need to consider all expenditure as a business transaction, and whether the outlay improves the property financially.
Always have a contingency budget.
Now you’re a property landlord, there will be unexpected expenses that are not budgeted for. The failure of a boiler, shower water leaks or even failed cookers are issues that need fixing straight away. Tenants often rent a property so they don’t have to deal with these problems, but they do expect them to be sorted and fixed instantly. They cannot wait until your next payday or the next payment of their rent. Keeping your tenants happy is the best piece of advice we can give. By not fixing the issue quickly you may lose that good, reliable tenant and face an empty property.
Hire a local expert.
As many accidental landlords are first-time landlords, it’s advisable to instruct a local property expert to assist with your property rental. A good local property company will save you time and money, finding you the right tenants, advising on the expected income, ensuring all legal requirements are met and can fully manage the property for you. A professional property management company will remove all the stress and those 3am call-outs from tenants, allowing you to enjoy the extra income every month.
Treat Your Tenants Well.
Your tenants are your customers and by treating them well you can usually increase the chance they’ll want to stay in your property. Long-term tenants will reduce the chances of your property being empty, providing you with the maximum return annually. Furthermore, a happy long-term tenant will look after your property; it’s their home now, thus reducing maintenance or damage costs.
Stay On Top Of Your Tax.
One of the biggest issues you will face as a new landlord is keeping track of your tax. When a new landlord starts receiving that monthly income, the temptation is to spend or invest the full amount and not consider your tax bill. Our advice would be to employ an expert accountant who can manage the finances and safeguard against any tax problems. Always keep your statements on income and expenditure for your annual tax return. If you employ a property management company, ask them to provide an annual report of income and expenditure of the property.
At Philip James, our property professionals have years of expertise and will handle every aspect of you becoming a landlord. We understand that renting out your old or family home can be very daunting and you might not know where to start. As leaders in property management and buy-to-let investments, we will make the process of becoming a landlord easy and straightforward.
Our dedicated property management office in West Didsbury will manage your property, taking away all the headaches you will encounter. From initial valuations and accompanied viewings to maintaining your property and legal requirements, we will manage the process from start to finish.
Philip James is the leading independent estate and letting agent in Manchester, we manage over 2500 properties across the region, ranging from single apartments to large property blocks. Visit www.philipjames.co.uk or call us today on 0161 448 4708 for more information and advice on our property management options. Instruct us to manage your property today and start enjoying being a landlord.