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Your Move Property Blog

Thoughts, Opinions & Analysis of the UK Property Market

Pros and Cons of Becoming a Landlord

March 3, 2014 09:07 by Your Move Chris Stonock

Blog: Pros and Cons of Becoming a Landlord - Your Move 

Becoming a landlord is an increasingly popular option for homeowners looking to generate an income from their property.  Many people buy to let as an investment, and it can be a sound investment if done well. However, there are several things that potential landlords need to be aware of before they buy.

Income…

There are many benefits to being a landlord, which is why a lot of people buy to let in the first place.  It sounds quite simple really, but generating income on your property is probably the biggest benefit overall and it’s possible to make substantial amounts over time that can be used to pay your mortgage.

Tax Deductions…

Although buy to let mortgages often have higher mortgage rates, you can apply for tax deductions on the income generated by your property that is used for maintenance, e.g. repainting, furniture replacement costs, etc. Landlords can also apply for deductions on insurance and accounting fees. 

Long-term security…

Renting a property can provide an ongoing income which can be saved as a pension, or for a 'rainy day', plus - if your living situation changes - it's also possible for you to use the property yourself (so long as you uphold any contracts signed with tenants).

Although being a landlord has plus points, there are some disadvantages you will need to be aware of before you consider becoming a landlord yourself. 

Time…

Being a landlord can be a time-consuming job. In addition to time spent sorting contracts, undertaking maintenance, sorting any disputes and dealing with taxes, you'll need to spend quality time vetting prospective tenants. 

Financial Extras…

It's not enough to simply have a house to let; being a landlord can incur many further expenses, not all of which are tax deductible. Some common costs include, tax on rental income, tenancy deposit scheme, gas safety certificate, energy efficiency certificate, repairs and maintenance, landlord insurance, etc.                                                                                                                                   

We offer 3 clear levels of service for landlords from a basic tenant finder service up to a fully comprehensive lettings service which includes financial management, property maintenance, and tenant handling.  For advice on becoming a landlord, or for more information about our lettings services, please call your local branch!

by Your Move, Chris Stonock




Packing Tips: Prepare your Wardrobes, Closets and Drawers for Moving out

February 26, 2014 09:00 by YOUR MOVE

Your Move Blog - Packing Tips

For practical reasons, the majority of packing usually has to take place close to the set moving date.  This can be very frustrating as you’re torn between wanting to get cracking on but not wanting to be without your ‘things’. While there are some packing jobs which really do need to be left right until the end, there is one big and potentially very time-consuming job that you can get to grips with well in advance, without it inconveniencing you at all. And, tackling it early has the added bonus of making the final packing and unpacking job a much more streamlined task too.

That area is your wardrobes, closets and drawers.  Wait, I hear you moan: “I can’t be without my things for weeks in advance!”  Of course you can’t and that’s why you don’t need to be if you follow a few simple and practical steps on how to balance your practical everyday pre-move needs with your desire to get on with the job.  The idea here is to make the contents portable and ready to go while keeping them accessible at the same time. 

Here’s what you do and what you‘ll need:

1. A selection of sturdy garment/storage bags and packs of varying sizes including some that are drawer sized.

2. A selection of hangers, including tiered ones to accommodate skirts and trousers

3. A pen and pack of postcard-sized labels.

Wardrobes

Start with the items you wear rarely and/or are unlikely to need between now and the time of your move.  Anything on a hanger can stay on a hanger but bulk up:  A single sturdy hanger will take up to e.g. 5 light items (e.g. shirts, tops etc) and 3-5 heavier ones.  Think two hangers-worth per bag.  Use the tiered hangers for skirts/trousers.  Pack like with like (e.g. delicate items and fabrics prone to creasing should be packed together so they can travel at the top of a packing box or, alternatively, in the back of your car on move day), label clearly and push to the ‘done’ side of the rail.  Do this until you’re left with just the clothing items that you’ll need between now and your move date which ideally, should hold no more than a couple of garment bags, and hang spare bags alongside the remaining clothing so they‘re ready and waiting for when you’re doing your final pack.

Drawers/Shelves

 Keep a maximum of two drawers/shelves for what you’ll use between now and your move date and, as with your wardrobe, apply the same principle of ‘need’.   Ideally use clear polythene storage packs here so you can see at a glance what’s where should you need to locate something urgently - zip, stick a label on it and place back in its original drawer. Come packing day, all you’ll have to do is lift it out, place in a packing box, job done.  Shoes and bags can be packed up in exactly the same way.  

The important thing to remember here is that whether you’re doing this a week or a couple of weeks in advance, you’ll still have access to everything, just that now they’re in portable containers and like you, are preparing for take-off!  In short, don‘t get distracted or bogged down in indecision about what to consign to the ’done’ side.  

When the move is imminent and you’re on box packing duty, fold the larger garment bags in half and place in a packing box.  Place the heavier items at the bottom (e.g. Shoes, boots, bags, coats etc.) and keep anything delicate at the top so the impact on the clothing while in transit is minimal. 

At the other end, you’ll arrive with a ready-made, clean, dust and damage-free wardrobe which can be immediately imported into its new home with the minimum of fuss.  


Guest post by Grace Bailey on behalf of Islington House Movers




Help, I’m Being Referenced! The Do’s & Don’ts of Tenant References

February 25, 2014 10:39 by YOUR MOVE

So you’ve found a property you want to rent, and the letting agent says you’ll need to be referenced.  Had you bargained for this?  Is it really necessary, and what can you do to prevent this formality turning into a headache?

Here are some useful tips for approaching referencing from the right angle, and ensuring the fastest possible turnaround by working with the referencing agency, not against them.  Would these pointers have helped you in previous applications?  Let us know in the comments below.

DO appreciate the need for referencing.
A tenancy agreement is a serious financial arrangement, and by putting their property in the hands of a stranger, the landlord is taking a risk.  To minimise that risk, information that is relevant to your suitability as a tenant, such as your income, your identity, or your credit history, must be independently verified before assessment.

DON’T take offence to being referenced.
You haven’t been singled out for referencing because somebody doesn’t trust you.  All applicants go through the same verification procedure, for insurance purposes and as standard protection for the landlord.  You may be the perfect tenant but i’s must be dotted and t’s must be crossed consistently.

DO examine the criteria before you apply.
Ideally, referencing should be about proving that your circumstances meet the requirements, not finding out whether they do or not.  If your income won’t be high enough or you’re on the wrong type of contract at work, then it’s better to realise this right away and get the ball rolling on a guarantor’s application if it’s already apparent that one will be required.  Also be sure to check whether all of your income can be taken into consideration or if certain kinds won’t be included in the referencing.

DON’T be unreachable.
There are many situations that may call for your further involvement in the referencing process after you’ve filled in the form, such as clarification of particular details on your application or additional paperwork being required.  To prevent delays during this time, ensure you check your emails and voicemails at least once a day, and make an exception to your personal rule about not answering the phone to numbers you don’t recognise!

DO confirm the best contacts to offer as referees.
And wherever possible, inform them that they will be contacted.  Considerable time can be wasted if the original contacts supplied are not in a position to provide references, or require authorisation from the applicant before agreeing to divulge information.  Giving the most appropriate person’s details first time can make referencing a much quicker and smoother process.

DON’T rely on the post if you can help it.
If you’re in a hurry to move in, the last thing you need is for referencing to be carried out by snail mail.  Try and provide as many alternative means of contact for your referees as possible, such as email addresses, fax numbers, and both landline and mobile telephone numbers, to maximise the chance of contact being made and the swiftest possible response obtained.


DO check which forms of ID are acceptable.
Not all referencing agencies are alike, and while your friends may assure you that certain documents will suffice, their experiences may be with different companies.  Avoid the frustration of additional trips by confirming with the agent that what you intend to bring into the office to prove your identity and address will meet their specific criteria.  If they require a bank statement or utility bill, how recent does it need to be?  If you don’t have a passport, will your work ID card be okay?  Just ask.

DON’T cut it too fine.
While every effort will be made to complete the referencing process quickly, there are many unavoidable circumstances that can slow things down, such as busy HR departments unwilling to prioritise one employee’s reference, or a previous landlord who really must do everything by post.  The more time you can allow for these unforeseen delays before your intended move-in date, the less stressful these speed bumps will be.

Referencing is a crucial part of the lettings process but is easily overlooked in the excitement of finding a home to rent.  The majority of times it’s only a minor inconvenience, and by utilising these tips there’s a strong chance that yours will be one of these times.  Even if you currently find yourself unlikely to pass referencing, a better understanding of the process can help avoid prolonging the inevitable and get you moving swiftly towards discussing the next best solution with your letting agent, like a guarantor or advance payment options. 

Good luck, and don’t forget to share your experiences in the comments below!

 

by James Hamill, Progression Co-ordinator, Your Move




Getting Rented Out - Buy to Let Part 5

February 24, 2014 09:36 by YOUR MOVE

Buy to Let Guide - Part 5 of 5 - Your Move

The last in this series of articles about buy to let, is how to get your property rented out?

  1. You’ll have done your research on the right area to buy in the likely achievable rents, and have bought your property. Now it’s time to approach a reputable letting agent to get the property let. Definitely speak to a few and check the charges before making the decision where to go.
  2. There are advertising mediums such as Gumtree that landlords can use but the risk you take with that is the lack of referencing of potential tenants.
  3. You can use a letting agent in two ways. If you know people who can potentially trouble shoot issues with the property, you may just want to use the lettings agent as a tenant finder. They might charge you a fee around six percent of the annual achievable rent but it’s a one off cost.
  4. The alternative way is to use their lettings management services. If the property is some way from where you live and you don’t have local contacts the agent can do the referencing and manage the property. Expect to pay around 12%for this service. Always use an agent that is ARLA registered and always make sure that there is an inventory of the contents in the property so you can check if there has been any damage by the tenant at the end of the tenancy. Make sure that the tenant gives you a deposit (suggest one month’s rent) which you can offset if there is damage.
  5. The most common form of tenancy agreement is the Assured Shorthold Tenancy. Essentially this gives the tenant a minimum six months security and potentially a year. The notice to vacate must be two months and therefore the tenant needs to have occupied the property for at least four months before it can be served.
  6. Letting via a local authority can be an option. The upside is that they can offer a free tenant finding service and the tenancy granted can be up to  36 months long. The downside is the potential family of hell and the rent offered by the local authority is unlikely to match what is available elsewhere. Also most lenders don’t accept tenancy agreements beyond a year.

Conclusion

From this series of posts you will have hopefully gained a much better insight into the world of property investment.

You can buy properties through auctions and repossessions but they each carry additional risks You may end up losing money in relation to upfront expenditure on surveys for properties you don’t win and with repossessions, the property will continue to be marketed until you exchange contracts with the seller.

As long as you do your homework, are realistic in your objectives and expectations, you should do well. It does take courage, particularly if you have to raise money from your residential property to fund the deposit but over the long term you will be very glad that you have done so.

By Simon Murray, Financial Consultant Your Move Surbiton

Buy to Let Part 1 - The Basics

Buy to Let Part 2 – Sourcing the Property

Buy to Let Part 3 – Getting an Offer Accepted

Buy to Let Part 4 – Sorting the Finance

 

 




January 2014 - Buy to Let Index

February 21, 2014 11:26 by YOUR MOVE

   

  • Capital’s landlords see average annual return of over £38,000 (or 14.6%) over past 12 months
  • Compares to average returns of almost £15,000 (or 8.9%) across England and Wales
  • Rents across England and Wales now average £742 per month, up by 1.4% since January 2013
  • Tenant finances recover in the New Year, as proportion of late rent falls to 7.4%

Rents across England & Wales

Average rents across England and Wales have risen 1.4% in the past year, to stand at £742 per month in January.

Annual rises come despite a seasonal fall in rents between December and January. The average rent across England and Wales fell by 0.4% on a monthly basis.

Rents by region

Five out of ten regions saw rents fall on a monthly basis between December and January, in line with a monthly fall across England and Wales as a whole

The sharpest monthly drop was found in the South East, with rents down 1.0%. This was followed by a drop of 0.9% in London, and a 0.7% fall on a monthly basis in Wales.

However, the West Midlands and East Midlands experienced monthly rent rises – up by 0.8% and 0.6% respectively since December.


Read the full Buy to Let index - January 2014




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