How to get your property ready for tenants

Friday, 13 January 2012 10:54 AM

by Domenic Versace

Starting out as a landlord? With house prices falling and rents rising many people are finding that putting a property up for let is the best option available to them.

Domenic Versace, the co-founder of comparison site ipostcode.com, explains how you should go about preparing your property for tenants.

Choose your letting agent wisely

When putting a property onto the market to let, most landlords select a handful of agents that are locally based to come and view the property.

The issue of fees is often not discussed until the last but this is something that can cost or save the landlord thousands of pounds.

Top tip: We developed ipostcode.com to encourage estate agents to be upfront about their fees and any sole agency tie in clauses. The cheapest agent is not necessarily the right agent to let your property but having a firm understanding of the different fees that are charged is paramount if you want to achieve healthy rental yields.

What to ask your letting agent

Before even inviting letting agents to value the property, find out if they are a member of a professional body such as The Association of Residential Letting Agents, The National Association of Estate Agents or The Royal Institution of Chartered Surveyors.

Top tip: Once you have established these basics, ask them direct questions such as how do they find tenants, which websites they advertise on, what 'let only' and 'let and managed' service packages are available, and a list of all charges that are likely to be incurred as a 'one off' and an ongoing basis (always get this in writing).

Get the property rental ready

Today's tenants are discerning and the more stylish your property, the more rent you are likely to receive. However, do not go overboard with the interior décor and remember not to let your personal taste affect the design of your property. There are some general 'must-haves' including using light colours throughout to make the rooms appear larger and brighter. Tenants will also demand clean, functional and modern kitchens and bathrooms.

Top tip: Get some insider info on how to decorate your buy-to-let property by visiting new build properties to get ideas from the experts.

Money Matters

Becoming a landlord is the same as starting your own business so you must get your finances in order, or get a good accountant who can help you. Claim for allowable expenses both prior to the start of letting and for ongoing expenses including mortgage interest, service charges, insurance, wear and tear, maintenance costs, travel costs and management/agency fees.

Top tip: All good businesses have something called an 'exit' strategy. Before you even invest in your buy-to-let property you need to plan when you want to sell it and also plan how you manage your tax exposure. Good planning could make you thousands of pounds.

Check them out

As a landlord, you should work with your agent to carry out the necessary background checks on potential tenants. There are various checks that can be carried out to give you peace of mind including a County Court Judgement search, address history, an ID check and alias name search, bankruptcy or insolvency inquiry, references from their employer and previous landlord, bank account details and an assessment of a tenant's ability to pay the rent.

Top tip: Getting these checks done will hopefully avoid rent arrears or other problems further down the road. If you are letting your property through an agent, see if they offer this service. Agent's fees can vary from five per cent to 15 per cent of the annual rent, depending on the level of service you require, but if all these checks are included in the fee then it may make financial sense to go for a slightly higher charging agent.

To furnish or not to furnish

Before considering the question of whether to furnish or not, you need to understand what sort of property and therefore what sort of tenant you are likely to attract. As a landlord you need to maximize your income whilst at the same time minimising the time and effort involved in maintaining a property. Providing furniture will often increase the rent, some figures suggest by as much as a third but think carefully before you do so.

Top tip: Furnishing a luxury apartment can easily cost in the region of £10,000 plus and although it is possible to furnish a home on a much more modest budget don't underestimate the skill in purchasing the right furniture to create the right look. For the top end of the market, you may want to consider companies that offer a bespoke furniture and fittings service. Some high street stores and new home developers are now offering a furniture package specifically designed for landlords.

Domenic Versace is from www.ipostcode.com, a brand new comparison website enabling the homeowner and landlord to compare the suitability of local sales and lettings agents.

Want to be the first to know when we break a story? Follow @AboutProperty on Twitter and subscribe to our free weekly newsletter.

Tags:
• landlords