ASK THE LANDLORD

[Trenners]

With house prices rising again, mortgage interest rates going up and rental income struggling to cover the investment mortgage and property maintenance costs, many landlords are wondering whether they should sell up and invest their money elsewhere.

Over the coming weeks we will be offering some handy tips and tricks on how to maximize your investment return as well as provide a level of protection if mortgage interest rates go up or house prices drop.

TRICK 1: MIND THE GAP

Landlords should always keep a watchful eye on the rental market to ensure that they have a realistic view on whether rents are rising or falling. Newspaper ads can give a good indication of how much rent is being achieved for similar properties but you should always remember that a property is only worth what a tenant is prepared to pay!

Novice landlords become obsessed by the level of monthly rent that they want to achieve whereas more experienced landlords realise that it can be more profitable to achieve a lower monthly rent if a good quality tenant can be secured quickly.

For example, a property priced at £800 per month that is empty for a month whilst the landlord looks for a suitable tenant will generate £8,800 income over a 12 month period whereas if the property could be let immediately at a rent of £750 per month then it would generate £9,000 income over the same time.

Successful landlords are always looking at ways to avoid having any periods of time when the property is empty and not earning them any income. This is known as a void period.

Void periods can be almost eliminated if the property is always well presented and maintained and the landlord (or letting agent) proactively promotes the availability of the property during the last weeks of the previous tenancy. The ideal scenario is to move out the old tenants and move in the new tenants - thereby avoiding a void!

Focus on only having a void when planned property maintenance is being undertaken between tenancies.

·If your property is void at the moment or you would like to discuss this article in more detail – call Mark at mlettings on 01793 752157 or visit www.mlettings.com.