Bad news, landlords. George Osborne announced in his Summer Budget that income tax relief will be cut to the basic rate which will be gradually phased in from 2017.
The Chancellor’s reasoning for this cut, from up to 45 % to 20%, is to ensure that an equal playing field exists between investors and homeowners. This is so that the unfairness in property taxation is addressed.
Unfortunately for you landlords, this means you will stripped of even more cash that goes towards your properties. Prepare yourself early for this change and plan to save money in other ways with these vital tips:
Cut out the cost of expensive advertising
High street letting agencies are a thing of the past; give an online letting agents a go and save up to thousands of pounds. By doing so you are responsible for property viewings as online agents don’t get involved, however this isn’t necessarily a bad thing. If you conduct your own viewings, you can meet the prospective tenant which allows you to assess them on a more personal and in-depth level. If this option doesn’t work out and you decide to a high street agency, you have only lost a small amount of money in the process. Additionally, you can advertise your property on Gumtree or Spare Room.
Review your mortgage costs
Like many other bills, you can shop around for the best deal. With the mortgage payments being the principal expenditure in most cases for landlords, you will need to review this on a regular basis by comparing rates online.
Employ an accountant
It is said that a good accountant will save you more money than what you pay for their services. Not only will an accountant notify you of the correct legal and tax procedures, but they can save you the time and effort of having to work out your finances. Hiring an accountant is well worth paying a couple of hundred pounds a year.
Take precautions from the word go
Before your tenant moves in, you must make sure that the property is suitable. You will need evidence of this; the best solution is to take photos of every single corner of the premises. You can even produce a video. This is to ensure that when the tenant moves out, you can assess if any damage has taken place during their stay. Another solution is to create an inventory (a list of all the properties’ contents, with the status of their condition). To protect yourself even further, invite your forthcoming tenant along to complete the inventory together, which they can then sign. If any damage has been caused, you can then aptly deduct any costs from the deposit.
Furnish for free (or for a low cost)
If you are renting out a furnished property, there are many online channels that offer free furniture. Take a look on Freecycle and Gumtree. You can also buy bargain second hand furnishings on online auctions such as eBay. Alternatively you can request to become a member of your local ‘free items’ and ‘buy and sell’ pages on Facebook. As long as the items are good quality, you can decorate your property in style on a low budget.
Research before buying appliances
Your tenant will be relying on you to supply robust appliances (for a furnished property) during their stay. Don’t just purchase the same brand that your appliances may be just because yours is good; brands can make changes at any time. It is also advisable not to go on price alone, because you can pay a lot of money for a top model with various features but it may not be as durable as a cheaper model. On first impressions a tenant may like the sound of a well branded appliance, however they will prefer how well it performs much more. Save more money by taking out one of our appliance warranty covers.
Be a nice landlord
It doesn’t cost anything to be respectful to your tenants, and by doing this you will benefit greatly in the long run. Respond to any of their queries as soon as you can (ideally within 24 hours unless you are away – notify them of any holidays prior to your departure) and organise maintenance and repairs promptly. This is along with making sure that all the legal requirements are met and providing living conditions that are clean, comfortable and more importantly safe. By abiding to the mentioned rules, as well as being polite and approachable, you should have a positive experience with your tenant. This means that they will treat your property with care and not exhaust your funds by destroying it with little thought. An unhappy tenant can also spread the word about their bad experience, which could result in less business and a damaged reputation.
Assess maintenance and repair requests
If your tenant reports any issues to you, the first thing to do is to assess the damage yourself. You don’t want to be spending money on calling a professional out when you don’t need to; the matter may be solvable by a simple action or by looking at our FAQ guides. However, if you think that you may waste time and effort trying to fix the problem and potentially making it worse, call a qualified and experienced professional. You will have to fork out money, but you will know that the job has been done correctly so that no more problems arise.
You can also save money by protecting yourself with our specialist landlord standard and premium cover plans, with FREE boiler service and CP12 certificate (Gas Safety Certificate).
247 Home Rescue accepts no liability for any damages you sustain following the advice on this website. If in doubt, seek professional assistance.