Buying an investment property and being a landlord has its pitfalls. Doing your homework is the difference between success and failure.
Make sure the property you buy has a good rental potential, good transport links, is near to amenities like shops, schools and hospitals and is in a good state of repair.
Vet prospective tenants carefully, obtaining references from previous landlords, proof of income, bank statements and credit checks. These do not necessarily guarantee that they will pay their rent, but you will know that funds are available.
Landlords have a legal requirement to register the tenant’s deposit into a deposit scheme. Failing to do so within 30 days of receipt will end in a prosecution for up to three times the deposit amount. Advise the tenants as soon as the deposit has been registered.
A complete list of items included both inside and outside the property is required. If you are unsure how to create your inventory, you could use a professional company that uses property inventory software such as https://inventorybase.co.uk/. The inventory should show the contents of each room and their condition, whether new or old. Any scratches, dents or stains should be listed, with photographs if possible, which will help in future if you have any disputes with your tenants about any damage which may occur.
Regular home insurance doesn’t fully cover rental properties: you need specialist landlord insurance, which will protect both the tenant and the landlord from unforeseen events. A rent and legal protection policy would also be beneficial should the tenants get behind with their rent.
As a landlord, you are responsible for the maintenance of the building and, as such, should check the property at regular intervals so that you can address any issues which may come up before they get worse. You must at all times notify the tenants and arrange mutually convenient visits and so allow your tenants the peace to live comfortably in their home.
If you live some distance away from the property and feel that you cannot fulfil all these requirements, you could put your property into the hands of an estate agent to manage your property for you. A management team would arrange new tenants, deal with the finances and take all the stress out of rental and tenancy agreements for you.