Are you a landlord? How do you find it?

[RainCloudsInTheSky]

We may have an opportunity to be a landlord but we are cautious about it. Does it take up much of your time? We would probably pay for the fully managed option so hoping it wouldn’t take up too much?

we’ve had a chat with estate agents and feel like we are understanding what is expected. Insurance has been recommended and I am yet to see what the cost of this may be.

would you recommend? Or wouldn’t do again? Interested in anything

Please leave the homes for people who want to actually live in them to buy.

Insurance has been recommended? You need insurance to be a landlord....

You don't sound clued up at all, in which case you shouldn't even be considering it.

Hi @RainCloudsInTheSky

We started off as accidental LL and now have 3 (soon to be 4) rental properties. As PP says, you will need LL insurance. We have the fully managed option and I would guess that we still end up spending maybe 4 hours a week on average dealing with queries from tenants, queries from the agent, liaising with accountant etc. There are quite a few hidden costs and good tenants can be hard to come by. Ours are all long term now. We’ve found we can be picky with tenants because the demand has been so high in the last few years, but also that it’s worth freezing the rent to keep good ones.

The only issue we had was when a previous tenant got 2 dogs in breach of his lease with us but also of a condition of the leasehold. He was evicted but it took time and was rather stressful with the neighbours constantly complaining about the dogs.

Hope it works out well.

Not everyone wants to buy

We rented our house out while overseas on two occasions, it went okay.
There wasn't a lot of work with the fully managed option.
There wasn't much money in it either.

There are quite a lot of risks, one friend had their house completely trashed, another had a family refuse to move out after they were served notice because they wanted a council property.

There are very few protections for landlords and I wouldn't recommend it unless you have very good insurance and don't actually need the income and don't care too much about the property.

Exactly. Also, it is my home as I’ve inherited it. So if I chose to rent it out that’s my choice. I’m not actively buying one to rent out although if I was that’s fine too.

🤣 Well I am considering it. I actually meant a certain company has been recommended but I haven’t looked into quotes yet.

Thank you. What kind of hidden costs are there? This is the type of info I’m after as want to make sure we definitely want to rent it out as opposed to sell it.

Not a landlord - but a friend was/is. They done both self managed and managed via an agent. From talking to them it seems highly stressful and very expensive. To quote them “They would earn more money by working part time in a min wage job and with less hassle. “ They are looking at either moving back in or selling up to downsize and never renting out a property again.

Thanks. We would need the income. Would you advise selling rather than renting out? We’ve done the maths and it seems doable (just need to get landlord insurance quotes). Estate agents said would have no trouble in renting it out so hopefully that’s the case. Just don’t want to regret it and wish we’d sold instead but I guess if it doesn’t work out we can always sell. (Although will need the market to go up and not down as currently predicted!)

Thank you. Something to think about.

I did it and had bad tenants - never again. I owned my own home then moved in with dh but kept it as a security net for a few years - absolute nightmare.

Yeah and sod all the people who can't afford to buy eh

I don’t love being a landlord… I have a flat I can’t afford to sell due to negative equity - I live in a different area with my husband and children now… it really wasn’t something I wanted to do and it’s just so stressful thinking about the what ifs and having the constant worry the boiler will break or something and whether there will be a leak or just anything and I’ll be hit with a surprise big bill. I’d sell it if I really could but it’s not an option. I don’t make any profit (obviously it does support my outstanding mortgage on the flat) but it’s a cost of living crisis! Following on from a pandemic! So I’ve kept the price low…

anyway. That’s just my experience! It’s obviously really good for a lot of people and if you’ve inherited the property & as such don’t have a mortgage then it probably won’t be as stressful.

good luck!

If fully managed it shouldn't take up much time at all. You will be responsible for maintaining the property and although the agent will arrange everything there will be times when the cost of maintenance eats significantly into the rent which you would otherwise receive. Our rental properties are much better maintained than the house we live in. There will also be additional fees every time the tenancy changes. Having said that, there have been times in recent years when rental income has outstripped interest on cash at the bank or income from other investments

Hidden costs are:

You need an EICR which is a electrical health check in the property. Costs a few hundred and lasts five years but if it failed you HAVE to rectify the items or it’s illegal to let.

If it’s a house with gas heating you HAVE to get a gas safety certificate EVERY year.

You HAVE to have an EPC and there are talks that from 2025 any rating less than a C can’t be let or needs investment spent on it to being it to a C. Whether that actually happens or not - who knows. You can apply for exemptions here if the renovations would be too costly.

You can get landlord insurance that continues to pay the rent if tenant defaults and pays legal fees to evict. GET THIS.

I have done it for 7 years now and always had good tenants luckily. Nice people and if you allow a pet (most tenants treat their pets well and look after the place) they will stay a long time as most landlords don’t allow pets. I have had cats and small dogs in my rentals and they never caused any issues.

However be mindful that the income is taxable. But you can deduct managing fees etc. I find that I spend some time sorting problems as they arise but apart from that have little contact with tenants. I hardly spend any time at all on the matter.

We rented out my house for a while when I moved into my husband's, it was ok and we had good tenants but we decided to sell it to pay off his mortgage. We bought another to rent out, a few years ago and so far it's going well (although we let it at mates rates to a family member until recently so we'll see now that it's going to be people we don't know). The house has gone up in value by £130k over the 4 years so it's been a good investment so far!

I would sell instead, landlords have no protection anymore and if you’re unlucky with bad tenants it will cost you thousands to evict with a length battle. If you’re in a higher tax bracket, it’s almost not worth the hassle, a lot of admin and ensuring you’re in compliance with the many & ever evolving rules.

I am a landlord for my old student flat (though not in a student area). It's a bloody nightmare and I would sell it tomorrow in a heartbeat.

About to spend £4k having a 2 bed flat in a terrible area/block redecorated and flooring redone cos of the terrible state last tenants (and their sodding cat) left it in.

Look up what happens if your tenants don't pay their rent... that is your big risk. It is months and months and expensive court fees to evict them.

If you can't get tenants then you become responsible for council tax and electricity/gas standing charge. So despite no mortgage it is not risk-free not to have tenants.

Every time tenants move out you will lose a full months rent minimum in costs of finding new tenants etc. Probably double that.

I have had everything from an absolutely amazing older couple who I would have let stay there indefinitely, to three people who disappeared after 2 months (but thankfully posted the keys and hadn't trashed the place) to the last couple who were just plain grubby.

I haven't (yet) had non-payers but the thought of it keeps me up at night.

The property has lost about 30% of its value (bought in 2008) but I'd suck up that loss to be rid of the worry if I could be (but it'll never sell just now).

There is a shortage of rental properties so I doubt renting out would be an issue.

A problem is needing the money because a tenant might move out unexpectedly and then they you have void months without payment.

Also boiler, white goods etc might break and need replacing immediately. This can happen surprisingly frequently and will eat up all your profit for a month. Tenants rightly expect things sorted quickly because they are paying.

Tenants will often expect to have pets, you can't ask for an extra deposit and the damage they cause can be considerable much more than their deposit.

I'm not saying don't do it just be aware of the pitfalls and problems.

Your house will need an electrical survey, gas check, septic tank check ( if relevant) chimney sweep ( if relevant), ecp. Etc. The management company can do all of this but again they all cost.
Particularly the electric survey if it is an older house and not up to modern code.

Thanks the hidden costs are all ones we are aware of luckily. The only thing that does worry me is the new laws with epc ratings that may affect us. Would need to look into that a bit more. I guess it’s worth a try and if it doesn’t work out we will sell.

Can you find someone to buy my flat? I hate renting it out but have a job with accommodation about 400miles away. It’s been on the market for 6 months.

What’s your magic solution? I’ve dropped the price twice, it’s on for 40k less than I bought it for to live in in 2007. Help me out!

We rent a house out and it has been fine. We manage it ourselves and vet the tenants really carefully so that helps. We also keep the rent as low as possible so it's affordable and pick tenants that we think will stay longer term.

It's quite low stress usually because we don't need the money (it just pays down the mortgage), we bought a house that was solidly built and decorated it robustly so we aren't picky about how it's treated, and we've been lucky with tenants.

The biggest downside I've found is that we now have quite a lot of equity locked up in a house I can't sell because it's someone else's home.

Am a landlord to a HMO and a number of flats. Find tenants through an estate agent who do all the checks and I manage them. I’m a really hands on landlord I do the cleaning in the HMO and respond v quickly to any issues.
I pride myself on being a good landlord and the tenants appreciate it,

Re: the EPC changes - this was announced last week as part of the net zero row-back