Category: (2)

So… either you’ve dipped your toe in the buy-to-let water already and are looking to expand your portfolio, or you’ve had a change of circumstances, or you’re possibly tired of the same-old boring nine-to-five job, to dedicate your working life to being a landlord. Great! It’s a big decision – and not one that should be taken lightly.

Mount & Minster, winner of last years East Midlands Lettings Agent award in the UK Real Estate & Property Awards, offers a guide to the basics, designed simply as a starting point:

Do the math.

Look at the difference between your total rental income and outgoings (mortgage repayments, insurance, agents’ fees, etc.). This is, in essence, your gross profit – and you’ll have to live on this (after putting some aside for tax) if you give up your day job.

Is this enough? Don’t forget vacancy periods where you wont have any income at all. Then there’s the occasional capital expense for repairs; boilers don’t last forever!

In order to live comfortably you’ll need around five properties or more, depending on The lifestyle you want to maintain.

Make a business plan

Get your bank manager on board. Use this opportunity to identify potential problems and outline your goals and how you’re going to achieve them. Take constructive criticism and use it to improve you plan.

Include your endgame. If the plan is to retire at 55 and sell your portfolio to fund a comfortable retirement, include this.

Manage or managed?

Tenants and tenancies can be tricky. Legislation is always changing. The day-to-day issues that will inevitably rear its ugly head need to addressed quickly and competently. If you’re knowledgable of the law and your statutory responsibilities then great. If you’re not sure or just simply don’t want to speak to plumbers, electiricans, students, council admin, debtors, utility companies etc, then make use of a professional and competent letting agent such as Mount & Minster.

Remember, if you get it wrong then you could go to prison or, at best, receive a hefty fine which will eat into your income.

Taking a wage

For tax purposes, you may well want to register as a limited company. In doing so, any profits the business makes belong to the business, and you’ll need to pay corporation tax on them. You’ll then need to pay yourself a wage as a director of the business. Or, you can alternatively take a small wage, then pay yourself a dividend once a year and pay tax on it through self-assessment.

If you elect not to register as a limited company, you’ll need to complete a self-assessment tax return and declare all of the profits you make, then pay income tax on them.

Managing your portfolio

As a full-time landlord, you’ll want to keep one eye on the wider housing market when deciding what to do with your properties.

You may want to accumulate as many properties as possible, or you may want to consolidate by having a smaller number of high-value properties that command a larger rent. This decision will depend on your local rental demographics, and a knowledgeable local lettings agent can steer you on where demand lies.

For instance, some landlords own several identical properties in the space of a few streets (although be aware this can leave you exposed in the event that demand for your one type of property suddenly dries up).  Equally, a local agent may suggest a diversified portfolio, aimed at a mix of renter types.

Next step…

Book an appointment with a professional agent and talk through your strategy. We can then point you in the right direction of suitable high yielding properties, help you acquire them, refer financial advisors and generally hold your hand from start… to retirement!

01476 515329 (Grantham office) or 01522 716204 (Lincoln office)

CHRISTMAS IS COMING AND THE TIME TO MOVE IS NOW!

TRADITIONALLY CHRISTMAS BECOMES A FOCUSED DEADLINE FOR VENDORS LOOKING TO MOVE BEFORE THE NEW YEAR STARTS. FOLLOW THE BELOW 5 STEPS AND THIS IS EASILY ACHIEVABLE.

ON AVERAGE IT TAKES 8 WEEKS FOR A NEWLY ON THE MARKET HOME TO FIND A BUYER AND WITH THE AVERAGE TIME FROM AGREEING A SALE TO THE MOVING DATE BEING ANOTHER 8 WEEKS, HOW CAN YOU ENSURE YOUR STOCKINGS ARE HANGING ON A NEW MANTLEPIECE THIS YEAR?

1. Choose the Right Estate Agent

Choosing an agent is an essential part of any property sale. However, when time is sensitive, choosing a competent agent who will ensure a professional and slick service is key. Selecting an agent who offers a multitude of bespoke marketing platforms is a vital element to the exposure your property will receive, increasing the opportunity for a swift sale at the best price.

Mount & Minster offer a multitude of different marketing packages and tools, including but not limited to, uniquely designed particulars, local and national print advertising, drone footage, access to the nationwide network of over 200 offices, numerous social media platforms and a busy website.

Mount & Minster pride themselves in their highly professional, pro-active and personable manner, alongside their RICS accreditations and three national awards.

2. Price Realistically

Ensure your pricing is realistic, it is not advisable to be over ambitious, it could put potential buyers off. If you place the property at a competitive price, you may get buyers competing which often results in offers above the guide price. Rightmove has noted that buyers now have more choice this month compared to last, with total available stock being up 2.1%. More properties on the market mean more competition and options other than yours for prospective purchasers.

Ensure that you get the right advice from a competent estate agent. A poor estate agent will over value your home just to get your instruction, only to lower the price later-on which may result in you getting a lower figure than if you’d got it right, right from the start. If an agent is the best at what they do, they’ll be RICS qualified.

3. Get Organised

Make sure you have all relevant paperwork on hand to avoid any delays. Provision for the legal aspects of a sale will help ensure that the process runs smoothly – this is just as important as the aesthetics of your property. Collating all relevant documents for your property prior to marketing will assure the buyer’s satisfaction down the line when queries arise.

Begin drafting an inventory of items which you anticipate leaving behind – the agents and solicitors will need to know which fixtures will remain, such as light fittings or the wood burning stove.

Compile all documents relating to any changes that you have made to the property. Alterations to the structure of the property will be required to comply to Building Regulations and Planning Permission at the time of the works, usually covered by a completion certificate. Windows installed after 1 April 2002 will require a FENSA certificate, and other remedial work will be assured by various guarantees.

You will also require an Energy Performance Certificate to market your property. This document shows potential buyers how the property could be more energy efficient and reduce its carbon dioxide emissions. Mount & Minster will arrange this survey on your behalf.

4. Get Ready…

Appoint a swift solicitor is essential to a quick move. A slow solicitor will frustrate both buyer and seller and could even scupper a sale, so act quickly. If you are unsure of which solicitor is right for you, Mount & Minster can offer guidance and recommendations in your area.

Competition is high on the property market, being an accommodating vendor could tip the scales in your direction for a successful sale. Allowing lengthy or viewings at irregular hours may assist in sealing the deal.

5. Book your removals

Nearly there! Your agent will liaise with you as to potential dates that will suit everyone in the chain. Once you’re ready to exchange, get booking! On the day of completion just collect the keys, decorate the tree and make sure the turkey fits in your new oven! Welcome home.

MOUNT & MINSTER OFFER THE EXPERTISE TO GIVE YOU THE BEST CHANCE TO BRING THE TURKEY TO THE TABLE IN TIME FOR CHRISTMAS. CONTACT ONE OF OUR HIGHLY TRAINED PROFESSIONALS TODAY ON EITHER  01522 716204 OR 01476 515329.