Considering a buy to let and taking the leap into becoming a landlord? Our buy to let tips provide you with everything you need to know before making your investment.

Be sure you know what investing in a buy to let property involves

Focusing solely on rental income can be tempting, but investing in a buy-to-let property requires a business-oriented mindset. It’s important to consider whether you can comfortably make mortgage payments and handle any potential stress that comes with managing the property yourself. Additionally, it’s wise to analyze the current market conditions and determine whether property values are on the rise. Furthermore, it’s important to decide whether you intend to let the property for the short or long term.

Make sure you understand the tax implications

Although rental income is subject to taxation, landlords are eligible to claim certain expenses as tax deductions. In addition to income tax, landlords are also required to pay stamp duty upon purchasing their property and capital gains tax when selling it. To learn more about the taxation of rental income, landlords can refer to the Property Income Manual, which is published by HMRC

It’s important to familiarise yourself with the legislation for buy-to-let properties.

Landlords have to comply with a wide range of legislation, much of which has changed in recent years, especially relating to tenants’ rights. Keeping up to date with the latest regulations and best practice will make you a better landlord and your properties more attractive to tenants.

• Electrical safety standards – the new electrical safety regulations came into force in April 2021 and mean landlords have to ensure that all fixed electrical installations and wiring is checked and tested by a qualified electrician. This is more often referred to as a EICR.
• Right to Rent – landlords need to check if a prospective tenant has the legal right to rent a property in England. This usually means checking passports and ID documentation to confirm a tenant’s immigration status.
• Eviction rights are changing – reform is promised on issues affecting tenants such as Section 21 notices, so make sure you know the current legislation before preparing a tenancy agreement
• Gas safety certifciate – prior to moving a tenant in and during the tenancy it is important to keep an up-to-date gas safety certiciate. Kellett & Co can provide this service to ensure you meet your legal obligations and protect your tenants and property with as little fuss as possible.
• Energy performance certificiate – It is a legal requirement under the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015. The purpose of the EPC is to assess the energy efficiency of a property and provide recommendations on how to improve its efficiency. This information can help tenants make informed decisions about their energy use and expenses, and can also help landlords identify areas where they can make improvements to save money and reduce their environmental impact.

Consider all the costs including landlord insurance

What will your costs be? As well as your mortgage payments, you will need to cover the following costs:

• Buildings insurance
• If your property is furnished you may wish to consider contents insurance too
• Costs associated with maintenance
• Periods when you are receiving no rental income because the property is empty or the tenants have fallen behind with their payments
• Increases in your mortgage repayments due to a rise in interest rates, which you may not be able to recover immediately from rental yields or rent increases

Pick low-maintenance properties

Assessing the condition of a property is essential before making a buy-to-let investment. Well-maintained properties are easier to manage and are generally more in demand than run-down properties. As a result, it may be advisable to consider investing in a newer property if you have limited time or no interest in DIY. By doing so, you can save yourself the hassle of repairs and upkeep, and potentially attract more tenants to your property.

It may be beneficial to consider the use of a lettings agent to oversee the management of your property.

Managing the property yourself can be challenging – you will have to deal with all the maintenance issues and any disputes with tenants. Being on constant call might not be for everyone.

At Kellett & Co we offer a range of lettings packages. Landlords can choose from:

• Affordable monthly management –  Kellett & Co looks after every aspect of the letting experience
• Let only – advertising, viewings, reference checks, tenancy paperwork. Landlord would deal with all rent arrears, disputes and maintenance issues
• Rent only – we will advertise the property, conduct viewings and reference checks on tenants and prepare tenancy agreements. We then only manage the rent received along with providing monthly and annual statements.

Why choose Kellett & Co?

Looking to rent your property quickly, easily and cost-effectively? Look no further than your local online estate agency. We can offer monthly management fees from as little as 7% without affecting the service you would normally receive from an agent with an office. In fact, by operating without the overheads that come with a physical office, we’re able to offer our customers cost savings that we can pass onto them.

Interested? Call today 01772 284898 or email Stephen at lettings@kellettandco.co.uk