Download - Part 1 - Buy to Let Roadmap
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Contents
IntroductionHowtoresearchsuitableareasforbuytoletFindingmotivatedsellersBuyingwithalimitedbudgetBirminghamCityCentreMoseleyandKingsHeathHarborneEdgbaston
RiskvsRewardChooseyouragentcarefullyTheidealnumberofbedroomsBrexitandtheUKpropertymarketMortgages-abriefoverviewforwouldbelandlordsTenantreferencingImmigrationchecksandrighttorentBudgetingforbuytoletYourbuytoletstrategyHealthandsafetyFurnitureElectricalchecksGassafetyResponsibilityforgasappliances
AuthorsnoteAcknowledgements
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Introduction
AuthorBio
DanielSperberisthefounderofConcentricSalesampLettingsinEdgbastonaswellasbeingtheauthortheleadingBirminghampropertywebsiteBirminghamPropertyBuzzwwwbhampropertybuzzcom
Danielandhisteamhaveover40yearsexperienceinpropertyandaspropertyinvestorsandlandlordsthemselvesknowwhatitslikedealingwiththedaytodaychallengesofbuyinglettingandmanagingallsortsorresidentialpropertyincludingflatshousesandHMOs
Whatothersaresayingabouttheauthor
Honestandunadulteratedpraisefrombothlandlordsandevenindustryinsiders
DanielisaveryexperiencedforwardthinkingestateagentandbusinessownerHisprofessionalapproachandinvaluableadvicehasbeenaneyeopenertoevenmyselfasanestateagentandbusinessownerofnearlyadecadeIfyouarealandlordorvendorintheareashecoversyoucoulddoyourselfahugefavourbygettingintouchwithhimforachatKevinOakesDansonPropertyServices
ldquoImjusttakingafewmomentstothankyouforafantasticfirstsixmonthslettingourpropertyWearefirsttimelandlordsandneededalotofhelpMovingabroadandlettingoutourbelovedfamilyhomehadthepotentialtobestressfulbutDanielmadeitsoeasyWebarelyhadtoliftafingerrdquoDrJohnKellyLandlord
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
SelectinganareaDecidingonwhereyoursquoregoingtobuyisprobablyoneofthemostimportantdecisionsyouwillmakeaswhereyoubuydictateswhoyouarelikelytorenttoBuyanex-councilpropertyinaroughareaandyoumaynotgettheprofessionaltenantsyouenvisagewhenyoucometomarketthepropertyUltimatelythepropertyandtheareaneedtobeinharmonyEssentiallyyouneedtobeofferingwhatyourtargetmarketwantsHowwelldoyouknowtheareaAretherebetterandworsepartsAreyoulocalandaretherepeopleyoucanaskYouseesomeareashaveabadnamebutinfacttherearegoodpartswhichifyougrewupintheareayouwouldbefamiliarwithAndthisisthekeyndashwhenbuyingordinaryfamilyhousinginnormalsuburbanareasmostlikelyyourtenantswillbepeoplewhogrewupthereWhatyougainwhenyouacquirethisin
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
depthlocalknowledgeisthepowertospotabargainOveralltheareamaybeconsideredtobealsquobadrsquoareaandhencethehousepricesconsiderablylowerbutyouknowthroughyourownresearchthatcertainpartsareactuallywellregardedlocallyIfyoucanrevealthissortoflocalknowledgeyouarelikelytodowellandwhilstyoumayneedtowaitfortherightpropertytocomealongwhenitdoesyouwillsurelybereadytopounceSohowcouldyouimproveyourlocalknowledgeHerearemytopsuggestions1GototheareayoursquoreconsideringandlookaroundforyourselfVisitatdifferenttimesofdayinthesamewayasifyouwerebuyingahouseforyourselftolivein
2MakecontactwithpeopleinthelocalareaSpeaktolocalbusinesses(cornershopsownersareoftenhappytochat)thelocalchippyevenifyoursquovegotthegutstodosostopafewpeopleatthelocalsupermarketandaskthemwherearethebestplacestoliveintheneighbourhood
3UsethewebsitewwwmousepricecomThiswebsitegivesyouallsortsofusefulinformationfromthecrimestatstothelocationofsocialhousingItreallyisavaluableresourceandshouldbeusedIwouldsayasafirstportofcallifyouaretryingtomakeaquickcomparisonofareaswhichyouhaveyettovisitBelowisanexampleofheatmapfromwwwmousepricecomshowingsocialhousingdensityinandaroundEdgbastonBirmingham
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
FindingmotivatedsellersIrsquomluckythatmostofthepeopleIspeaktoinmylineofworkarepositivego-gettersIsupposeinmanywaysinpropertyyouhavetobelikethistomakethingsworkforyouHowevernowandagainIcomeacrossoneoftheglasshalfemptysortsorlsquodoomandgloomersrsquoasIsometimesliketocallthemThesepeoplearequicktotellyouwhysomethingwonrsquotworkforthemldquoIcanrsquotgetadecentmortgageraterdquoorldquoAlltheestateagentsIspeaktoarecrookedrdquoorevenldquoTherearenrsquotanypropertydealstobehadinBirminghamanymorerdquoThelistofcomplaintsorexcusescangoonandonbuttheonethingwhichtheyallhaveincommonisthattheyarejustthathellipexcusesYouseetherearealwayswaystogetaheadofthecompetitionSomeofthemtakemoreeffortandpatiencethanothersndashonethingIalwaysrecommendtowouldbeinvestorsistogoandmeettheagentswhoareactiveintheirchosenareandashbuttherearealsoquickwins
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
SoherersquosonesuchquickwinhellipDidyouknowthatanyonecangoontoZooplaandseeonlythosepropertieslistedinthelast30daysYoudidOkayherersquosthenextbithellipDidyoualsoknowthatyoucanalsospecifytoonlyshowpropertieswhichhavebeenmarkedbytheagentasbeinglsquochainfreersquoYoudidokaysohereisthefinalbitwhichcreatesthemagichellipYoucanalsoorderthelistofpropertiesinorderoftheamountreducedSonowyouhavealistofallsellerswhoarenewtothemarketandarehighlymotivatedtosellTryitforyourselfandseewhatcomesupwhichyoumighthaveotherwisemissed
AREAFOCUS-BIRMINGHAM
WherecanyoubuyinBirminghamwithalimitedbudgetAshousepricesgouppropertyinvestorswithsmallerbudgetsarefindingitincreasinglydifficulttofindpropertiesatthelowerendofthemarketFrommyconversationswithinvestorsthepricepointwhichmostseemtoneedtobuyunderisaroundpound120000SowhatcouldyoubuyatthisfigureWellitalldependswhereyoursquorelookingbutinBirminghamthefollowingcouldbeworthconsideringastypicalexamplesofpotentiallygoodbuytoletinvestments
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BirminghamCityCentrepound120000willbuyyouastudioapartmentinvariouscitycentredevelopmentsRelativelyspeakingforthefloorspaceyougetthepriceyoupayisquitehighbutthereagainsoistherentmakingstudiosoneofthebetteryieldinginvestmentsinBirminghamCityCentreDownsideLikeallcitycentreapartmentsyoucanpayasubstantialchunkofyourrenteachmonthforgroundrentandservicecharges
MoseleyandKingsHeathAgainpound120000willputyousquarelyinflatterritorybutthistimeyouwillbelookingatonebedsratherthanstudiosIfyouareveryluckyandyoucanfindoneyoumayalsofindatwobedroommaisonettewhichneedsworkTheyieldsherewillbefairlysimilartothecitycentrebutthegroundrentspossiblylowerDownsideThereisnotquitethesamelevelofdemandforflatshereasinBirminghamCityCentre
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HarborneIfyoursquoreluckyyoumightfindaonebedroomflatinoneoftheolderblocksontheBearwoodsideofHarborneforyourbudgetorastudioapartmentifitrsquosmorecentrallylocatedRentsinHarborneremainhighsosimilaryieldstoMoseleyDownsideThemajorityoftherentalstockinHarborneisterracedhousingmakingflatshardertofindatthisprice
EdgbastonEdgbastonisamassiveareaandifsomeonesaysthataparticularpropertyisinEdgbastonthenyouneedtoactuallylookatwhereitisonthemapConceivablyitcouldlieanywherebetweenPershoreRoad(EdgbastonCricketGround)andCapeHillAvailableoptionsforyouwithabudgetofpound120000willincludebothflatsandhousesInparticularifyoulookoverontheCityHospitalsideofthearea(aroundSelseyRoadSwindonRoadetc)youwillfindarangeofterracedhousingwithinyourbudgetYieldsherewillbeonaparwithCityCentreorhighergiventhatforthemostparttherewillbenoservicechargestopayDownsideWhilsttheareamaybecalledEdgbastonitisnottheEdgbastonwhichyoumightimaginewiththesprawlinghousesandmanicuredlawns
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
RiskvsRewardWithpricesinBirminghamontheriseitrsquosunsurprisingthatmanypropertyinvestorsarestartingtolooktothesurroundingareasforcheaperpropertiesFormosttherootoftheproblemisthelargeamountofdepositrequiredbythemajorityofbuytoletlendersNowthethingisthisndash
wherevertheybuyinvestorsstillwanttoachievegoodyieldsandcapitalgrowthButasweknowifoneareaischeaperthananotheritisprobablybecauseitisnotseenasbeingasdesirableAtextremesthismaymeanthatthecalibreoftenantisnotthesameandwiththiscomesassociatedrisksThisbringsmenicelyontothesubjectofriskversusrewardYouseeyourarelygetsomethingfornothingEitheryougoforanicesafebet(sayatraditionalterracejustofftheKingsHeathhighstreet)withanaverage4yieldoryougoforsomethingmoreriskylikeaflatinanex-councilblockwitha7-10yieldNowmostlandlordsarenotsnobsafterallformostitissimplyabusinessandtheyhavelittleornoemotionalattachmenttothepropertyitselfsothethingtobearinmindwhenoptingforahigherriskstrategyistheeaseofmanagement
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhereasthemanagementofapropertyinaprimelocationmaybefairlystraightforwardandeasilytackledbythelandlordthemselvesyoumightwellcomeupagainstsomehurdleswhenlookingafterapropertyinahigherriskareaForexampleyoumayfindyourselfhavingtodealwithhousingbenefitclaimsYoumayalsohavetoacceptthatyourtenanthasmultiplesourcesofincomewhichmaymeanthattheircashflowandconsequentlyyourcashflowarenotassmoothasyoursquodbothlikeInadditionyoumaywellfindthatyourpropertysuffersmorewithwearandtearaslowerincometenantsaremorelikelytobefamiliesthancouplesorsinglepeopleThereisnorightorwronginthisitissimplyacaseofwhatyou(andifyoursquoreusingoneyourlettingagent)feelcomfortablewith
ChooseyouragentcarefullyIrsquodliketotellyouaboutsomethingwhichhappenedearlierthisweekandwhichquitefranklyastoundedmeAlandlordwhoIhaveknownforthebestpartofsixyearsbuthavenrsquotseenforaboutninemonths(youngbabyputhimoutofactionforabit)toldmeabouttheproblemshehadbeenhavingwithhislettingagentNowIrsquodjustliketosaybeforeIgoanyfurtherthatthisisnrsquotaboutanyofthelocalagentsinourareainfacttheagentconcernedisnrsquoteveninSouthBirminghamhoweverIthinkthisisapertinentlessonforanylandlordespeciallythosewithanumberofpropertieswhichtheyentrusttoasingleagentBasicallywhathadhappenedwasthatthelandlordrsquoslettingagent(whomanagedintheregionof50or60propertiesforhim)hadnotbeenpayinghimthefullrentThiswasnrsquotbecausemaintenancehadbeendoneatthepropertiesandthereforedeductedfromtherentitwassimplythecasethatthisdishonestagentassumedthatbecausethelandlordhadsomanypropertieshewouldnrsquotnoticeafewquidmissinghereorthere
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhilstIrsquodliketothinkthatiftheyweremypropertiesIwouldnoticeashortfallIcanrsquothonestlysaythatIwouldbeabletotellifIhad50ormorepropertieswithvariousrentscominginatdifferenttimesduringthemonthThelessonhereisthatanydecentagentshouldbeprovidingasamatterofcoursemonthlyemailedstatementsWhetheritrsquosforalandlordwithasinglepropertyinwhichcaseitissimplyabreakdownofrentreceivedminusfeesandmaintenanceagainstrentremittedorforalandlordwithaportfolioofpropertiesasummaryplustheindividualstatementsThankfullythelandlordinquestiongothismoneybackbutitmightnothavebeensuchahappyendingifthesituationhadgoneonforlongerandtheamountofrentindeficithadbeenhigherIndeedhadthelettingagentnotbeensolventthisisasituationwhichmayneverhavebeenputrightAndthisgotmethinkingHowmanylandlordsoutthereareunhappywiththeirlettingagentbutratherthanvotingwiththeirfeetandtakingtheirbusinesselsewhereareinsteadjustputtingupandshuttingupIfthingsarenrsquotrightwhywouldnrsquotyouchangeWhatrsquosstoppingyoufrommovingyourpropertiestoanagentwhoappreciatesyourbusinessIsitbecauseyoubelievethatmovingtoanotheragentmidtenancyissimplytoodifficulttooriskyormaybesimplythatyoudonrsquotknowhowitrsquosdoneIntruthitrsquosnotthatdifficultyoujustneedthenervetodoit
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhatrsquostheidealnumberofbedroomsOneofthequestionsIamoftenaskedbynewinvestorsiswhatistheidealnumberofbedroomsforarentalpropertyTheanswerinpartdependsonwhetheryouaretalkingabouthousesorflatsItalsodependsonwhatyourinvestmentstrategyisByinvestmentstrategyImeanwhetheryouaretryingtomaximisetheyieldforshorttermcash-floworgoingforapropertywithpotentialforgoodcapitalappreciationinthelongertermOfcourseyoumaywellbeaimingforacombinationofthetwoToanswerthequestionofhowmanybedroomsisbetterforbuytoletweneedtounderstandtheeffectthishasonboththeyieldandthecapitalappreciationWealsoneedtoacknowledgethatitwillvarybyareaandbypropertytypeLetrsquoslookatMoseleyasanexampleWewilllookatjustoneandtwobedroomflatsinMoseley
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
LetrsquosfirstlookattheaskingpricesAtaglancetheaverageaskingpricetodayofaonebedroomflatinMoseleyispound90000Incontrasttheaverageaskingpriceforatwobedispound133000SowhatabouttherentsWellbasedonwhatisadvertisedtodayonZooplaatypicalonebedroomflatisadvertisedwitharentalpriceofpound500percalendarmonthandatwobedatpound610permonthTranslatethisintoyieldsandthatrsquosayieldof66fortheonebedagainst55forthetwobedSopurelyintermsofachievableyieldstheonebedisthebetteroptionButwhataboutcapitalappreciationWellthisiswhereitgetsabitmoredifficultNormallyifIwasgoingtopredictpotentialforcapitalappreciationIwouldlooktopreviousyearsrsquogrowthasanindicatorHoweverthepastdecadehasbeenaturbulenttimeforpropertyownersandnomoresothanforthosewhoboughtflatsinMoseleyArapidincreaseinthebuildingofnewflatscoupledwiththenationwideeconomicproblemsresultedinvaluesstagnatingoreveninnegativegrowthforsomeThankfullythingsseemtohavesettledsomewhatandifyouwerebuyingaflatnowyoucoulddosowithalotmoreconfidenceAstwobedsappealbothtohomeownersandbuytoletinvestorsthesenormallyofferbothbettercapitalappreciationandareeasiertosellinthelongrunOfcourseanotheroptionwouldbetofocusinsteadonhouseswhichhavecontinuedtoappreciate
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ShouldyoubeworryingaboutBrexitUnlessyoursquovebeenlivinginacavetheselastcoupleofweeksyoursquollhavestruggledtoescapethetorrentofdiscussionsconjecturesandanalysisinthemediaofthesocalledBrexitWhetheritisrightorwrongremainstobeseenandsurelywewillonlytrulybeabletojudgewiththebenefitofhindsighthoweveronethingwhichseemstohavebeenmissedbythemainstreammediaisthepotentialimpactontheUKpropertymarketNowyoumightsaythatthereasonthishasnrsquotbeendiscussedisbecausetheeffectislargelyunknownbutIwouldsaythatthisisnotthereasonAfterallwhodoesreallyknowatthisstagetheimpactofanimpendingdivorcefromtheEUonanyspecificaspectoftheUKeconomyEventhefutureoftheNHSwhichwasamajorpointoffocusduringthepre-referendumcampaigningseemstobeinquestionSowhyhastheimpactontheUKpropertymarketnotbeensowidelydiscussedintheensuingweekssincethereferendumMyopinionisthisndashpropertyinvestorsfallintooneoftwocampsSeriousinvestorswhohaveclearlydefinedobjectivesfortheirpropertybusinessesThesepeoplehavenrsquotgotintopropertyonawhimInsteadtheyhavethoughtaboutitplannedforitandindeedtheyhaveputinplacecongruentstrategieswhichhelpthemmeettheirobjectivesSuretheymaynowbeconcernedaboutwhatmaychangeintheensuingmonthsandyearsbuttheywilllargelyadaptanddevelopnewtacticswhichwillallowthemtonotonlywhetheranstormbutalsotakeadvantageoftheprevailingconditionsSowhyisthisgroupnottalkingaboutBrexitSimplebecausetheyarebusydoinghellipbusythinkingplanningreviewingandadapting
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
thesepeoplenottalkingaboutBrexitBecauseiftheydidnrsquothaveaplanpre-referendumtheymostlikelydonrsquothaveonenowTobeblunttheyrsquorestickingtheirheadinthesandNowincaseyouthinkIrsquombeingoverlyharshtothissecondgroupletrsquosbeclearndashIhavemassivesympathyforaccidentallandlordsManyofmyclientsfallintothisgroupandtheyarenotinthispositionbecausetheychosetobeMaybetheyboughtatthepeakofthemarketandfoundthemselvesbeingunabletomovewhentheirfamilygrewOthersnodoubtownedhomespriortomeetinggirlfriendsboyfriendshusbandsandwivesOvertheyearstheadvicehasoftenbeengiventhatifyoucanrsquotselljustrentNeverthelessmypointremainsthattheydidnotactivelychoosetobeinthispositionSowhatwillhappentotheUKpropertymarketAtthetimeofwritingIamseparatedfrommycrystalball[IlentittoaWelshfootiefanandnevergotitback]soIwillrefrainfrommakingwildpredictionsHoweverIwillstatethefollowinghellipIrrespectiveofwhathappenspostreferendumthefollowingremainsunalteredhellipdemandandsupplyofhousingYesmortgageratesmaychangeandmortgagesmaybecomemoreorlessaccessiblendashindeedwemayallfeellikewehavemoreorlessmoneyinourpocketndashbutultimatelyweallstillneedsomewheretoliveInconclusionIthinkthechoiceyouhaveasapropertyinvestoriswhetheryouallowexternaleventstodictateyouractionsorwhetheryougrabthebullbythehornsandcreateyourownoutcomeIdonrsquotknowaboutyoubutIknowwhichoneIprefer
ThesecondgrouparetheaccidentallandlordsThesepeoplearenrsquotreallyinvestorsatallThisisthegroupwhoifthewindchangeswillmostsurelyfeeltheeffectsmostkeenlyWhyare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
MortgagesByMatthewJonesofMoneywatchFinance01217453347AlltoooftenpeopledecidetobuyapropertywithoutconsideringtheimportanceofgettingtheirfinancialduckslinedupWehavehadinstancesinthepastwherepeoplehavespentmanymonthssearchingfortheidealbuytoletpropertyonlyforeverythingtofallapartbecausetheyhadnrsquotdonethebasicsIwouldencourageanyinvestorlookingtobuytolettotakeacarefullookattheirowncreditreportsomethingthebankswilluseinthedecisionmakingprocessoftenmakingitthefirstthingtheycheckviaanautomatedprocessldquocomputersaysnordquoThethreecreditbureausintheUKarecurrentlyExperianEquifaxandCallCreditThefirsttwowillallowyouaccesstoyourcreditreportforthefirst28daysforfreebutwhatmanypeopledonotknowisthatCallCreditallowsyouaccesstoyourrecordsfreeofchargeforlifeviathewebsitewwwnoddlecoukWehavehelpedmanyinvestorsoverthepastfewyearsimprovetheircreditscoreHereareafewsimpleyeteffectivetipsUseyourcreditcardandclearitinfulleverymonthtohelpbuildyourcreditscoreDonrsquotuseyouroverdraftLendersnowtreatoverdraftsthesameastheywouldpaydaylendingBettertohavepound1000inyourcurrentaccountconstantlyandpound1000lessinyoursavingsaccountsMakesureyouareontheelectoralroll-againwehaveseeninvestorswithlargedepositsanddecentincomesfailthelendersinitialchecksbecausetheywerenrsquotontheelectoralrollFinallydonrsquotassumebuytoletlenderswonrsquotbeinterestedinyourincomeThingshavechangedandthemarketisalottighternowadayswithalotmore
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ReferencingThesadfactisthatevengoodtenantscanturnbadsonoamountofreferencingorcreditcheckswillcompletelyeliminateyourrisksHoweverwithacombinationofthoroughreferencingcreditchecksandtoppingitalloffwitharentguaranteeyoucertainlycanminimiseyourexposuretofinanciallossWhilstnotimpossibleitcanbedifficultforlandlordstodoacreditcheckonpotentialtenantsThisiswhymanylandlordspreferthistobedonebyalettingagentHoweverasabareminimumIwouldsuggestthatanylandlordshouldcheckthefollowing
Checkthatyourpotentialtenantcancomfortablyaffordtherent(30xmonthlyrentasanannualincomeisagoodguide)CheckwiththelandlordhowtheirprevioustenancywasconductedCheckthatpotentialtenantshavethelegalrighttoresideandrentintheUK(seenextsection)
FinallyandthisissomethingwhichmostagentswontsaytoyoubutIwillasIamalsoalandlordsoIwill-useyourgutinstinct
ImnotsayingyoucanrelyonyourgutinstincttospotagoodtenantbutifyourgutinstincttellsyouthatapotentialtenantwillbeproblematicthenyoureprobablycorrectAlotofthisboilsdowntoexperiencebutsuchthingswhichsometimesringalarmbellswithmeinclude
BeingabsolutelydesparatetomoveinOfferingtopayalargerdepositoreventhefullrentupfrontfornoapparentreasonBeingunabletoprovidefullreferencesViewingonbehalfofsomeoneelsewhoyouareunabletomeetuntilthemovein
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Introduction
AuthorBio
DanielSperberisthefounderofConcentricSalesampLettingsinEdgbastonaswellasbeingtheauthortheleadingBirminghampropertywebsiteBirminghamPropertyBuzzwwwbhampropertybuzzcom
Danielandhisteamhaveover40yearsexperienceinpropertyandaspropertyinvestorsandlandlordsthemselvesknowwhatitslikedealingwiththedaytodaychallengesofbuyinglettingandmanagingallsortsorresidentialpropertyincludingflatshousesandHMOs
Whatothersaresayingabouttheauthor
Honestandunadulteratedpraisefrombothlandlordsandevenindustryinsiders
DanielisaveryexperiencedforwardthinkingestateagentandbusinessownerHisprofessionalapproachandinvaluableadvicehasbeenaneyeopenertoevenmyselfasanestateagentandbusinessownerofnearlyadecadeIfyouarealandlordorvendorintheareashecoversyoucoulddoyourselfahugefavourbygettingintouchwithhimforachatKevinOakesDansonPropertyServices
ldquoImjusttakingafewmomentstothankyouforafantasticfirstsixmonthslettingourpropertyWearefirsttimelandlordsandneededalotofhelpMovingabroadandlettingoutourbelovedfamilyhomehadthepotentialtobestressfulbutDanielmadeitsoeasyWebarelyhadtoliftafingerrdquoDrJohnKellyLandlord
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
3
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
SelectinganareaDecidingonwhereyoursquoregoingtobuyisprobablyoneofthemostimportantdecisionsyouwillmakeaswhereyoubuydictateswhoyouarelikelytorenttoBuyanex-councilpropertyinaroughareaandyoumaynotgettheprofessionaltenantsyouenvisagewhenyoucometomarketthepropertyUltimatelythepropertyandtheareaneedtobeinharmonyEssentiallyyouneedtobeofferingwhatyourtargetmarketwantsHowwelldoyouknowtheareaAretherebetterandworsepartsAreyoulocalandaretherepeopleyoucanaskYouseesomeareashaveabadnamebutinfacttherearegoodpartswhichifyougrewupintheareayouwouldbefamiliarwithAndthisisthekeyndashwhenbuyingordinaryfamilyhousinginnormalsuburbanareasmostlikelyyourtenantswillbepeoplewhogrewupthereWhatyougainwhenyouacquirethisin
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
4
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
depthlocalknowledgeisthepowertospotabargainOveralltheareamaybeconsideredtobealsquobadrsquoareaandhencethehousepricesconsiderablylowerbutyouknowthroughyourownresearchthatcertainpartsareactuallywellregardedlocallyIfyoucanrevealthissortoflocalknowledgeyouarelikelytodowellandwhilstyoumayneedtowaitfortherightpropertytocomealongwhenitdoesyouwillsurelybereadytopounceSohowcouldyouimproveyourlocalknowledgeHerearemytopsuggestions1GototheareayoursquoreconsideringandlookaroundforyourselfVisitatdifferenttimesofdayinthesamewayasifyouwerebuyingahouseforyourselftolivein
2MakecontactwithpeopleinthelocalareaSpeaktolocalbusinesses(cornershopsownersareoftenhappytochat)thelocalchippyevenifyoursquovegotthegutstodosostopafewpeopleatthelocalsupermarketandaskthemwherearethebestplacestoliveintheneighbourhood
3UsethewebsitewwwmousepricecomThiswebsitegivesyouallsortsofusefulinformationfromthecrimestatstothelocationofsocialhousingItreallyisavaluableresourceandshouldbeusedIwouldsayasafirstportofcallifyouaretryingtomakeaquickcomparisonofareaswhichyouhaveyettovisitBelowisanexampleofheatmapfromwwwmousepricecomshowingsocialhousingdensityinandaroundEdgbastonBirmingham
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
FindingmotivatedsellersIrsquomluckythatmostofthepeopleIspeaktoinmylineofworkarepositivego-gettersIsupposeinmanywaysinpropertyyouhavetobelikethistomakethingsworkforyouHowevernowandagainIcomeacrossoneoftheglasshalfemptysortsorlsquodoomandgloomersrsquoasIsometimesliketocallthemThesepeoplearequicktotellyouwhysomethingwonrsquotworkforthemldquoIcanrsquotgetadecentmortgageraterdquoorldquoAlltheestateagentsIspeaktoarecrookedrdquoorevenldquoTherearenrsquotanypropertydealstobehadinBirminghamanymorerdquoThelistofcomplaintsorexcusescangoonandonbuttheonethingwhichtheyallhaveincommonisthattheyarejustthathellipexcusesYouseetherearealwayswaystogetaheadofthecompetitionSomeofthemtakemoreeffortandpatiencethanothersndashonethingIalwaysrecommendtowouldbeinvestorsistogoandmeettheagentswhoareactiveintheirchosenareandashbuttherearealsoquickwins
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
SoherersquosonesuchquickwinhellipDidyouknowthatanyonecangoontoZooplaandseeonlythosepropertieslistedinthelast30daysYoudidOkayherersquosthenextbithellipDidyoualsoknowthatyoucanalsospecifytoonlyshowpropertieswhichhavebeenmarkedbytheagentasbeinglsquochainfreersquoYoudidokaysohereisthefinalbitwhichcreatesthemagichellipYoucanalsoorderthelistofpropertiesinorderoftheamountreducedSonowyouhavealistofallsellerswhoarenewtothemarketandarehighlymotivatedtosellTryitforyourselfandseewhatcomesupwhichyoumighthaveotherwisemissed
AREAFOCUS-BIRMINGHAM
WherecanyoubuyinBirminghamwithalimitedbudgetAshousepricesgouppropertyinvestorswithsmallerbudgetsarefindingitincreasinglydifficulttofindpropertiesatthelowerendofthemarketFrommyconversationswithinvestorsthepricepointwhichmostseemtoneedtobuyunderisaroundpound120000SowhatcouldyoubuyatthisfigureWellitalldependswhereyoursquorelookingbutinBirminghamthefollowingcouldbeworthconsideringastypicalexamplesofpotentiallygoodbuytoletinvestments
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BirminghamCityCentrepound120000willbuyyouastudioapartmentinvariouscitycentredevelopmentsRelativelyspeakingforthefloorspaceyougetthepriceyoupayisquitehighbutthereagainsoistherentmakingstudiosoneofthebetteryieldinginvestmentsinBirminghamCityCentreDownsideLikeallcitycentreapartmentsyoucanpayasubstantialchunkofyourrenteachmonthforgroundrentandservicecharges
MoseleyandKingsHeathAgainpound120000willputyousquarelyinflatterritorybutthistimeyouwillbelookingatonebedsratherthanstudiosIfyouareveryluckyandyoucanfindoneyoumayalsofindatwobedroommaisonettewhichneedsworkTheyieldsherewillbefairlysimilartothecitycentrebutthegroundrentspossiblylowerDownsideThereisnotquitethesamelevelofdemandforflatshereasinBirminghamCityCentre
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HarborneIfyoursquoreluckyyoumightfindaonebedroomflatinoneoftheolderblocksontheBearwoodsideofHarborneforyourbudgetorastudioapartmentifitrsquosmorecentrallylocatedRentsinHarborneremainhighsosimilaryieldstoMoseleyDownsideThemajorityoftherentalstockinHarborneisterracedhousingmakingflatshardertofindatthisprice
EdgbastonEdgbastonisamassiveareaandifsomeonesaysthataparticularpropertyisinEdgbastonthenyouneedtoactuallylookatwhereitisonthemapConceivablyitcouldlieanywherebetweenPershoreRoad(EdgbastonCricketGround)andCapeHillAvailableoptionsforyouwithabudgetofpound120000willincludebothflatsandhousesInparticularifyoulookoverontheCityHospitalsideofthearea(aroundSelseyRoadSwindonRoadetc)youwillfindarangeofterracedhousingwithinyourbudgetYieldsherewillbeonaparwithCityCentreorhighergiventhatforthemostparttherewillbenoservicechargestopayDownsideWhilsttheareamaybecalledEdgbastonitisnottheEdgbastonwhichyoumightimaginewiththesprawlinghousesandmanicuredlawns
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
RiskvsRewardWithpricesinBirminghamontheriseitrsquosunsurprisingthatmanypropertyinvestorsarestartingtolooktothesurroundingareasforcheaperpropertiesFormosttherootoftheproblemisthelargeamountofdepositrequiredbythemajorityofbuytoletlendersNowthethingisthisndash
wherevertheybuyinvestorsstillwanttoachievegoodyieldsandcapitalgrowthButasweknowifoneareaischeaperthananotheritisprobablybecauseitisnotseenasbeingasdesirableAtextremesthismaymeanthatthecalibreoftenantisnotthesameandwiththiscomesassociatedrisksThisbringsmenicelyontothesubjectofriskversusrewardYouseeyourarelygetsomethingfornothingEitheryougoforanicesafebet(sayatraditionalterracejustofftheKingsHeathhighstreet)withanaverage4yieldoryougoforsomethingmoreriskylikeaflatinanex-councilblockwitha7-10yieldNowmostlandlordsarenotsnobsafterallformostitissimplyabusinessandtheyhavelittleornoemotionalattachmenttothepropertyitselfsothethingtobearinmindwhenoptingforahigherriskstrategyistheeaseofmanagement
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhereasthemanagementofapropertyinaprimelocationmaybefairlystraightforwardandeasilytackledbythelandlordthemselvesyoumightwellcomeupagainstsomehurdleswhenlookingafterapropertyinahigherriskareaForexampleyoumayfindyourselfhavingtodealwithhousingbenefitclaimsYoumayalsohavetoacceptthatyourtenanthasmultiplesourcesofincomewhichmaymeanthattheircashflowandconsequentlyyourcashflowarenotassmoothasyoursquodbothlikeInadditionyoumaywellfindthatyourpropertysuffersmorewithwearandtearaslowerincometenantsaremorelikelytobefamiliesthancouplesorsinglepeopleThereisnorightorwronginthisitissimplyacaseofwhatyou(andifyoursquoreusingoneyourlettingagent)feelcomfortablewith
ChooseyouragentcarefullyIrsquodliketotellyouaboutsomethingwhichhappenedearlierthisweekandwhichquitefranklyastoundedmeAlandlordwhoIhaveknownforthebestpartofsixyearsbuthavenrsquotseenforaboutninemonths(youngbabyputhimoutofactionforabit)toldmeabouttheproblemshehadbeenhavingwithhislettingagentNowIrsquodjustliketosaybeforeIgoanyfurtherthatthisisnrsquotaboutanyofthelocalagentsinourareainfacttheagentconcernedisnrsquoteveninSouthBirminghamhoweverIthinkthisisapertinentlessonforanylandlordespeciallythosewithanumberofpropertieswhichtheyentrusttoasingleagentBasicallywhathadhappenedwasthatthelandlordrsquoslettingagent(whomanagedintheregionof50or60propertiesforhim)hadnotbeenpayinghimthefullrentThiswasnrsquotbecausemaintenancehadbeendoneatthepropertiesandthereforedeductedfromtherentitwassimplythecasethatthisdishonestagentassumedthatbecausethelandlordhadsomanypropertieshewouldnrsquotnoticeafewquidmissinghereorthere
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhilstIrsquodliketothinkthatiftheyweremypropertiesIwouldnoticeashortfallIcanrsquothonestlysaythatIwouldbeabletotellifIhad50ormorepropertieswithvariousrentscominginatdifferenttimesduringthemonthThelessonhereisthatanydecentagentshouldbeprovidingasamatterofcoursemonthlyemailedstatementsWhetheritrsquosforalandlordwithasinglepropertyinwhichcaseitissimplyabreakdownofrentreceivedminusfeesandmaintenanceagainstrentremittedorforalandlordwithaportfolioofpropertiesasummaryplustheindividualstatementsThankfullythelandlordinquestiongothismoneybackbutitmightnothavebeensuchahappyendingifthesituationhadgoneonforlongerandtheamountofrentindeficithadbeenhigherIndeedhadthelettingagentnotbeensolventthisisasituationwhichmayneverhavebeenputrightAndthisgotmethinkingHowmanylandlordsoutthereareunhappywiththeirlettingagentbutratherthanvotingwiththeirfeetandtakingtheirbusinesselsewhereareinsteadjustputtingupandshuttingupIfthingsarenrsquotrightwhywouldnrsquotyouchangeWhatrsquosstoppingyoufrommovingyourpropertiestoanagentwhoappreciatesyourbusinessIsitbecauseyoubelievethatmovingtoanotheragentmidtenancyissimplytoodifficulttooriskyormaybesimplythatyoudonrsquotknowhowitrsquosdoneIntruthitrsquosnotthatdifficultyoujustneedthenervetodoit
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhatrsquostheidealnumberofbedroomsOneofthequestionsIamoftenaskedbynewinvestorsiswhatistheidealnumberofbedroomsforarentalpropertyTheanswerinpartdependsonwhetheryouaretalkingabouthousesorflatsItalsodependsonwhatyourinvestmentstrategyisByinvestmentstrategyImeanwhetheryouaretryingtomaximisetheyieldforshorttermcash-floworgoingforapropertywithpotentialforgoodcapitalappreciationinthelongertermOfcourseyoumaywellbeaimingforacombinationofthetwoToanswerthequestionofhowmanybedroomsisbetterforbuytoletweneedtounderstandtheeffectthishasonboththeyieldandthecapitalappreciationWealsoneedtoacknowledgethatitwillvarybyareaandbypropertytypeLetrsquoslookatMoseleyasanexampleWewilllookatjustoneandtwobedroomflatsinMoseley
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
LetrsquosfirstlookattheaskingpricesAtaglancetheaverageaskingpricetodayofaonebedroomflatinMoseleyispound90000Incontrasttheaverageaskingpriceforatwobedispound133000SowhatabouttherentsWellbasedonwhatisadvertisedtodayonZooplaatypicalonebedroomflatisadvertisedwitharentalpriceofpound500percalendarmonthandatwobedatpound610permonthTranslatethisintoyieldsandthatrsquosayieldof66fortheonebedagainst55forthetwobedSopurelyintermsofachievableyieldstheonebedisthebetteroptionButwhataboutcapitalappreciationWellthisiswhereitgetsabitmoredifficultNormallyifIwasgoingtopredictpotentialforcapitalappreciationIwouldlooktopreviousyearsrsquogrowthasanindicatorHoweverthepastdecadehasbeenaturbulenttimeforpropertyownersandnomoresothanforthosewhoboughtflatsinMoseleyArapidincreaseinthebuildingofnewflatscoupledwiththenationwideeconomicproblemsresultedinvaluesstagnatingoreveninnegativegrowthforsomeThankfullythingsseemtohavesettledsomewhatandifyouwerebuyingaflatnowyoucoulddosowithalotmoreconfidenceAstwobedsappealbothtohomeownersandbuytoletinvestorsthesenormallyofferbothbettercapitalappreciationandareeasiertosellinthelongrunOfcourseanotheroptionwouldbetofocusinsteadonhouseswhichhavecontinuedtoappreciate
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
14
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ShouldyoubeworryingaboutBrexitUnlessyoursquovebeenlivinginacavetheselastcoupleofweeksyoursquollhavestruggledtoescapethetorrentofdiscussionsconjecturesandanalysisinthemediaofthesocalledBrexitWhetheritisrightorwrongremainstobeseenandsurelywewillonlytrulybeabletojudgewiththebenefitofhindsighthoweveronethingwhichseemstohavebeenmissedbythemainstreammediaisthepotentialimpactontheUKpropertymarketNowyoumightsaythatthereasonthishasnrsquotbeendiscussedisbecausetheeffectislargelyunknownbutIwouldsaythatthisisnotthereasonAfterallwhodoesreallyknowatthisstagetheimpactofanimpendingdivorcefromtheEUonanyspecificaspectoftheUKeconomyEventhefutureoftheNHSwhichwasamajorpointoffocusduringthepre-referendumcampaigningseemstobeinquestionSowhyhastheimpactontheUKpropertymarketnotbeensowidelydiscussedintheensuingweekssincethereferendumMyopinionisthisndashpropertyinvestorsfallintooneoftwocampsSeriousinvestorswhohaveclearlydefinedobjectivesfortheirpropertybusinessesThesepeoplehavenrsquotgotintopropertyonawhimInsteadtheyhavethoughtaboutitplannedforitandindeedtheyhaveputinplacecongruentstrategieswhichhelpthemmeettheirobjectivesSuretheymaynowbeconcernedaboutwhatmaychangeintheensuingmonthsandyearsbuttheywilllargelyadaptanddevelopnewtacticswhichwillallowthemtonotonlywhetheranstormbutalsotakeadvantageoftheprevailingconditionsSowhyisthisgroupnottalkingaboutBrexitSimplebecausetheyarebusydoinghellipbusythinkingplanningreviewingandadapting
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
15
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
thesepeoplenottalkingaboutBrexitBecauseiftheydidnrsquothaveaplanpre-referendumtheymostlikelydonrsquothaveonenowTobeblunttheyrsquorestickingtheirheadinthesandNowincaseyouthinkIrsquombeingoverlyharshtothissecondgroupletrsquosbeclearndashIhavemassivesympathyforaccidentallandlordsManyofmyclientsfallintothisgroupandtheyarenotinthispositionbecausetheychosetobeMaybetheyboughtatthepeakofthemarketandfoundthemselvesbeingunabletomovewhentheirfamilygrewOthersnodoubtownedhomespriortomeetinggirlfriendsboyfriendshusbandsandwivesOvertheyearstheadvicehasoftenbeengiventhatifyoucanrsquotselljustrentNeverthelessmypointremainsthattheydidnotactivelychoosetobeinthispositionSowhatwillhappentotheUKpropertymarketAtthetimeofwritingIamseparatedfrommycrystalball[IlentittoaWelshfootiefanandnevergotitback]soIwillrefrainfrommakingwildpredictionsHoweverIwillstatethefollowinghellipIrrespectiveofwhathappenspostreferendumthefollowingremainsunalteredhellipdemandandsupplyofhousingYesmortgageratesmaychangeandmortgagesmaybecomemoreorlessaccessiblendashindeedwemayallfeellikewehavemoreorlessmoneyinourpocketndashbutultimatelyweallstillneedsomewheretoliveInconclusionIthinkthechoiceyouhaveasapropertyinvestoriswhetheryouallowexternaleventstodictateyouractionsorwhetheryougrabthebullbythehornsandcreateyourownoutcomeIdonrsquotknowaboutyoubutIknowwhichoneIprefer
ThesecondgrouparetheaccidentallandlordsThesepeoplearenrsquotreallyinvestorsatallThisisthegroupwhoifthewindchangeswillmostsurelyfeeltheeffectsmostkeenlyWhyare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
MortgagesByMatthewJonesofMoneywatchFinance01217453347AlltoooftenpeopledecidetobuyapropertywithoutconsideringtheimportanceofgettingtheirfinancialduckslinedupWehavehadinstancesinthepastwherepeoplehavespentmanymonthssearchingfortheidealbuytoletpropertyonlyforeverythingtofallapartbecausetheyhadnrsquotdonethebasicsIwouldencourageanyinvestorlookingtobuytolettotakeacarefullookattheirowncreditreportsomethingthebankswilluseinthedecisionmakingprocessoftenmakingitthefirstthingtheycheckviaanautomatedprocessldquocomputersaysnordquoThethreecreditbureausintheUKarecurrentlyExperianEquifaxandCallCreditThefirsttwowillallowyouaccesstoyourcreditreportforthefirst28daysforfreebutwhatmanypeopledonotknowisthatCallCreditallowsyouaccesstoyourrecordsfreeofchargeforlifeviathewebsitewwwnoddlecoukWehavehelpedmanyinvestorsoverthepastfewyearsimprovetheircreditscoreHereareafewsimpleyeteffectivetipsUseyourcreditcardandclearitinfulleverymonthtohelpbuildyourcreditscoreDonrsquotuseyouroverdraftLendersnowtreatoverdraftsthesameastheywouldpaydaylendingBettertohavepound1000inyourcurrentaccountconstantlyandpound1000lessinyoursavingsaccountsMakesureyouareontheelectoralroll-againwehaveseeninvestorswithlargedepositsanddecentincomesfailthelendersinitialchecksbecausetheywerenrsquotontheelectoralrollFinallydonrsquotassumebuytoletlenderswonrsquotbeinterestedinyourincomeThingshavechangedandthemarketisalottighternowadayswithalotmore
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
17
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ReferencingThesadfactisthatevengoodtenantscanturnbadsonoamountofreferencingorcreditcheckswillcompletelyeliminateyourrisksHoweverwithacombinationofthoroughreferencingcreditchecksandtoppingitalloffwitharentguaranteeyoucertainlycanminimiseyourexposuretofinanciallossWhilstnotimpossibleitcanbedifficultforlandlordstodoacreditcheckonpotentialtenantsThisiswhymanylandlordspreferthistobedonebyalettingagentHoweverasabareminimumIwouldsuggestthatanylandlordshouldcheckthefollowing
Checkthatyourpotentialtenantcancomfortablyaffordtherent(30xmonthlyrentasanannualincomeisagoodguide)CheckwiththelandlordhowtheirprevioustenancywasconductedCheckthatpotentialtenantshavethelegalrighttoresideandrentintheUK(seenextsection)
FinallyandthisissomethingwhichmostagentswontsaytoyoubutIwillasIamalsoalandlordsoIwill-useyourgutinstinct
ImnotsayingyoucanrelyonyourgutinstincttospotagoodtenantbutifyourgutinstincttellsyouthatapotentialtenantwillbeproblematicthenyoureprobablycorrectAlotofthisboilsdowntoexperiencebutsuchthingswhichsometimesringalarmbellswithmeinclude
BeingabsolutelydesparatetomoveinOfferingtopayalargerdepositoreventhefullrentupfrontfornoapparentreasonBeingunabletoprovidefullreferencesViewingonbehalfofsomeoneelsewhoyouareunabletomeetuntilthemovein
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
19
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
20
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
21
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
3
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
SelectinganareaDecidingonwhereyoursquoregoingtobuyisprobablyoneofthemostimportantdecisionsyouwillmakeaswhereyoubuydictateswhoyouarelikelytorenttoBuyanex-councilpropertyinaroughareaandyoumaynotgettheprofessionaltenantsyouenvisagewhenyoucometomarketthepropertyUltimatelythepropertyandtheareaneedtobeinharmonyEssentiallyyouneedtobeofferingwhatyourtargetmarketwantsHowwelldoyouknowtheareaAretherebetterandworsepartsAreyoulocalandaretherepeopleyoucanaskYouseesomeareashaveabadnamebutinfacttherearegoodpartswhichifyougrewupintheareayouwouldbefamiliarwithAndthisisthekeyndashwhenbuyingordinaryfamilyhousinginnormalsuburbanareasmostlikelyyourtenantswillbepeoplewhogrewupthereWhatyougainwhenyouacquirethisin
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
4
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
depthlocalknowledgeisthepowertospotabargainOveralltheareamaybeconsideredtobealsquobadrsquoareaandhencethehousepricesconsiderablylowerbutyouknowthroughyourownresearchthatcertainpartsareactuallywellregardedlocallyIfyoucanrevealthissortoflocalknowledgeyouarelikelytodowellandwhilstyoumayneedtowaitfortherightpropertytocomealongwhenitdoesyouwillsurelybereadytopounceSohowcouldyouimproveyourlocalknowledgeHerearemytopsuggestions1GototheareayoursquoreconsideringandlookaroundforyourselfVisitatdifferenttimesofdayinthesamewayasifyouwerebuyingahouseforyourselftolivein
2MakecontactwithpeopleinthelocalareaSpeaktolocalbusinesses(cornershopsownersareoftenhappytochat)thelocalchippyevenifyoursquovegotthegutstodosostopafewpeopleatthelocalsupermarketandaskthemwherearethebestplacestoliveintheneighbourhood
3UsethewebsitewwwmousepricecomThiswebsitegivesyouallsortsofusefulinformationfromthecrimestatstothelocationofsocialhousingItreallyisavaluableresourceandshouldbeusedIwouldsayasafirstportofcallifyouaretryingtomakeaquickcomparisonofareaswhichyouhaveyettovisitBelowisanexampleofheatmapfromwwwmousepricecomshowingsocialhousingdensityinandaroundEdgbastonBirmingham
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
5
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
FindingmotivatedsellersIrsquomluckythatmostofthepeopleIspeaktoinmylineofworkarepositivego-gettersIsupposeinmanywaysinpropertyyouhavetobelikethistomakethingsworkforyouHowevernowandagainIcomeacrossoneoftheglasshalfemptysortsorlsquodoomandgloomersrsquoasIsometimesliketocallthemThesepeoplearequicktotellyouwhysomethingwonrsquotworkforthemldquoIcanrsquotgetadecentmortgageraterdquoorldquoAlltheestateagentsIspeaktoarecrookedrdquoorevenldquoTherearenrsquotanypropertydealstobehadinBirminghamanymorerdquoThelistofcomplaintsorexcusescangoonandonbuttheonethingwhichtheyallhaveincommonisthattheyarejustthathellipexcusesYouseetherearealwayswaystogetaheadofthecompetitionSomeofthemtakemoreeffortandpatiencethanothersndashonethingIalwaysrecommendtowouldbeinvestorsistogoandmeettheagentswhoareactiveintheirchosenareandashbuttherearealsoquickwins
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
6
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
SoherersquosonesuchquickwinhellipDidyouknowthatanyonecangoontoZooplaandseeonlythosepropertieslistedinthelast30daysYoudidOkayherersquosthenextbithellipDidyoualsoknowthatyoucanalsospecifytoonlyshowpropertieswhichhavebeenmarkedbytheagentasbeinglsquochainfreersquoYoudidokaysohereisthefinalbitwhichcreatesthemagichellipYoucanalsoorderthelistofpropertiesinorderoftheamountreducedSonowyouhavealistofallsellerswhoarenewtothemarketandarehighlymotivatedtosellTryitforyourselfandseewhatcomesupwhichyoumighthaveotherwisemissed
AREAFOCUS-BIRMINGHAM
WherecanyoubuyinBirminghamwithalimitedbudgetAshousepricesgouppropertyinvestorswithsmallerbudgetsarefindingitincreasinglydifficulttofindpropertiesatthelowerendofthemarketFrommyconversationswithinvestorsthepricepointwhichmostseemtoneedtobuyunderisaroundpound120000SowhatcouldyoubuyatthisfigureWellitalldependswhereyoursquorelookingbutinBirminghamthefollowingcouldbeworthconsideringastypicalexamplesofpotentiallygoodbuytoletinvestments
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
7
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BirminghamCityCentrepound120000willbuyyouastudioapartmentinvariouscitycentredevelopmentsRelativelyspeakingforthefloorspaceyougetthepriceyoupayisquitehighbutthereagainsoistherentmakingstudiosoneofthebetteryieldinginvestmentsinBirminghamCityCentreDownsideLikeallcitycentreapartmentsyoucanpayasubstantialchunkofyourrenteachmonthforgroundrentandservicecharges
MoseleyandKingsHeathAgainpound120000willputyousquarelyinflatterritorybutthistimeyouwillbelookingatonebedsratherthanstudiosIfyouareveryluckyandyoucanfindoneyoumayalsofindatwobedroommaisonettewhichneedsworkTheyieldsherewillbefairlysimilartothecitycentrebutthegroundrentspossiblylowerDownsideThereisnotquitethesamelevelofdemandforflatshereasinBirminghamCityCentre
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
8
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HarborneIfyoursquoreluckyyoumightfindaonebedroomflatinoneoftheolderblocksontheBearwoodsideofHarborneforyourbudgetorastudioapartmentifitrsquosmorecentrallylocatedRentsinHarborneremainhighsosimilaryieldstoMoseleyDownsideThemajorityoftherentalstockinHarborneisterracedhousingmakingflatshardertofindatthisprice
EdgbastonEdgbastonisamassiveareaandifsomeonesaysthataparticularpropertyisinEdgbastonthenyouneedtoactuallylookatwhereitisonthemapConceivablyitcouldlieanywherebetweenPershoreRoad(EdgbastonCricketGround)andCapeHillAvailableoptionsforyouwithabudgetofpound120000willincludebothflatsandhousesInparticularifyoulookoverontheCityHospitalsideofthearea(aroundSelseyRoadSwindonRoadetc)youwillfindarangeofterracedhousingwithinyourbudgetYieldsherewillbeonaparwithCityCentreorhighergiventhatforthemostparttherewillbenoservicechargestopayDownsideWhilsttheareamaybecalledEdgbastonitisnottheEdgbastonwhichyoumightimaginewiththesprawlinghousesandmanicuredlawns
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
9
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
RiskvsRewardWithpricesinBirminghamontheriseitrsquosunsurprisingthatmanypropertyinvestorsarestartingtolooktothesurroundingareasforcheaperpropertiesFormosttherootoftheproblemisthelargeamountofdepositrequiredbythemajorityofbuytoletlendersNowthethingisthisndash
wherevertheybuyinvestorsstillwanttoachievegoodyieldsandcapitalgrowthButasweknowifoneareaischeaperthananotheritisprobablybecauseitisnotseenasbeingasdesirableAtextremesthismaymeanthatthecalibreoftenantisnotthesameandwiththiscomesassociatedrisksThisbringsmenicelyontothesubjectofriskversusrewardYouseeyourarelygetsomethingfornothingEitheryougoforanicesafebet(sayatraditionalterracejustofftheKingsHeathhighstreet)withanaverage4yieldoryougoforsomethingmoreriskylikeaflatinanex-councilblockwitha7-10yieldNowmostlandlordsarenotsnobsafterallformostitissimplyabusinessandtheyhavelittleornoemotionalattachmenttothepropertyitselfsothethingtobearinmindwhenoptingforahigherriskstrategyistheeaseofmanagement
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
10
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhereasthemanagementofapropertyinaprimelocationmaybefairlystraightforwardandeasilytackledbythelandlordthemselvesyoumightwellcomeupagainstsomehurdleswhenlookingafterapropertyinahigherriskareaForexampleyoumayfindyourselfhavingtodealwithhousingbenefitclaimsYoumayalsohavetoacceptthatyourtenanthasmultiplesourcesofincomewhichmaymeanthattheircashflowandconsequentlyyourcashflowarenotassmoothasyoursquodbothlikeInadditionyoumaywellfindthatyourpropertysuffersmorewithwearandtearaslowerincometenantsaremorelikelytobefamiliesthancouplesorsinglepeopleThereisnorightorwronginthisitissimplyacaseofwhatyou(andifyoursquoreusingoneyourlettingagent)feelcomfortablewith
ChooseyouragentcarefullyIrsquodliketotellyouaboutsomethingwhichhappenedearlierthisweekandwhichquitefranklyastoundedmeAlandlordwhoIhaveknownforthebestpartofsixyearsbuthavenrsquotseenforaboutninemonths(youngbabyputhimoutofactionforabit)toldmeabouttheproblemshehadbeenhavingwithhislettingagentNowIrsquodjustliketosaybeforeIgoanyfurtherthatthisisnrsquotaboutanyofthelocalagentsinourareainfacttheagentconcernedisnrsquoteveninSouthBirminghamhoweverIthinkthisisapertinentlessonforanylandlordespeciallythosewithanumberofpropertieswhichtheyentrusttoasingleagentBasicallywhathadhappenedwasthatthelandlordrsquoslettingagent(whomanagedintheregionof50or60propertiesforhim)hadnotbeenpayinghimthefullrentThiswasnrsquotbecausemaintenancehadbeendoneatthepropertiesandthereforedeductedfromtherentitwassimplythecasethatthisdishonestagentassumedthatbecausethelandlordhadsomanypropertieshewouldnrsquotnoticeafewquidmissinghereorthere
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
11
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhilstIrsquodliketothinkthatiftheyweremypropertiesIwouldnoticeashortfallIcanrsquothonestlysaythatIwouldbeabletotellifIhad50ormorepropertieswithvariousrentscominginatdifferenttimesduringthemonthThelessonhereisthatanydecentagentshouldbeprovidingasamatterofcoursemonthlyemailedstatementsWhetheritrsquosforalandlordwithasinglepropertyinwhichcaseitissimplyabreakdownofrentreceivedminusfeesandmaintenanceagainstrentremittedorforalandlordwithaportfolioofpropertiesasummaryplustheindividualstatementsThankfullythelandlordinquestiongothismoneybackbutitmightnothavebeensuchahappyendingifthesituationhadgoneonforlongerandtheamountofrentindeficithadbeenhigherIndeedhadthelettingagentnotbeensolventthisisasituationwhichmayneverhavebeenputrightAndthisgotmethinkingHowmanylandlordsoutthereareunhappywiththeirlettingagentbutratherthanvotingwiththeirfeetandtakingtheirbusinesselsewhereareinsteadjustputtingupandshuttingupIfthingsarenrsquotrightwhywouldnrsquotyouchangeWhatrsquosstoppingyoufrommovingyourpropertiestoanagentwhoappreciatesyourbusinessIsitbecauseyoubelievethatmovingtoanotheragentmidtenancyissimplytoodifficulttooriskyormaybesimplythatyoudonrsquotknowhowitrsquosdoneIntruthitrsquosnotthatdifficultyoujustneedthenervetodoit
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
12
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhatrsquostheidealnumberofbedroomsOneofthequestionsIamoftenaskedbynewinvestorsiswhatistheidealnumberofbedroomsforarentalpropertyTheanswerinpartdependsonwhetheryouaretalkingabouthousesorflatsItalsodependsonwhatyourinvestmentstrategyisByinvestmentstrategyImeanwhetheryouaretryingtomaximisetheyieldforshorttermcash-floworgoingforapropertywithpotentialforgoodcapitalappreciationinthelongertermOfcourseyoumaywellbeaimingforacombinationofthetwoToanswerthequestionofhowmanybedroomsisbetterforbuytoletweneedtounderstandtheeffectthishasonboththeyieldandthecapitalappreciationWealsoneedtoacknowledgethatitwillvarybyareaandbypropertytypeLetrsquoslookatMoseleyasanexampleWewilllookatjustoneandtwobedroomflatsinMoseley
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
13
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
LetrsquosfirstlookattheaskingpricesAtaglancetheaverageaskingpricetodayofaonebedroomflatinMoseleyispound90000Incontrasttheaverageaskingpriceforatwobedispound133000SowhatabouttherentsWellbasedonwhatisadvertisedtodayonZooplaatypicalonebedroomflatisadvertisedwitharentalpriceofpound500percalendarmonthandatwobedatpound610permonthTranslatethisintoyieldsandthatrsquosayieldof66fortheonebedagainst55forthetwobedSopurelyintermsofachievableyieldstheonebedisthebetteroptionButwhataboutcapitalappreciationWellthisiswhereitgetsabitmoredifficultNormallyifIwasgoingtopredictpotentialforcapitalappreciationIwouldlooktopreviousyearsrsquogrowthasanindicatorHoweverthepastdecadehasbeenaturbulenttimeforpropertyownersandnomoresothanforthosewhoboughtflatsinMoseleyArapidincreaseinthebuildingofnewflatscoupledwiththenationwideeconomicproblemsresultedinvaluesstagnatingoreveninnegativegrowthforsomeThankfullythingsseemtohavesettledsomewhatandifyouwerebuyingaflatnowyoucoulddosowithalotmoreconfidenceAstwobedsappealbothtohomeownersandbuytoletinvestorsthesenormallyofferbothbettercapitalappreciationandareeasiertosellinthelongrunOfcourseanotheroptionwouldbetofocusinsteadonhouseswhichhavecontinuedtoappreciate
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
14
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ShouldyoubeworryingaboutBrexitUnlessyoursquovebeenlivinginacavetheselastcoupleofweeksyoursquollhavestruggledtoescapethetorrentofdiscussionsconjecturesandanalysisinthemediaofthesocalledBrexitWhetheritisrightorwrongremainstobeseenandsurelywewillonlytrulybeabletojudgewiththebenefitofhindsighthoweveronethingwhichseemstohavebeenmissedbythemainstreammediaisthepotentialimpactontheUKpropertymarketNowyoumightsaythatthereasonthishasnrsquotbeendiscussedisbecausetheeffectislargelyunknownbutIwouldsaythatthisisnotthereasonAfterallwhodoesreallyknowatthisstagetheimpactofanimpendingdivorcefromtheEUonanyspecificaspectoftheUKeconomyEventhefutureoftheNHSwhichwasamajorpointoffocusduringthepre-referendumcampaigningseemstobeinquestionSowhyhastheimpactontheUKpropertymarketnotbeensowidelydiscussedintheensuingweekssincethereferendumMyopinionisthisndashpropertyinvestorsfallintooneoftwocampsSeriousinvestorswhohaveclearlydefinedobjectivesfortheirpropertybusinessesThesepeoplehavenrsquotgotintopropertyonawhimInsteadtheyhavethoughtaboutitplannedforitandindeedtheyhaveputinplacecongruentstrategieswhichhelpthemmeettheirobjectivesSuretheymaynowbeconcernedaboutwhatmaychangeintheensuingmonthsandyearsbuttheywilllargelyadaptanddevelopnewtacticswhichwillallowthemtonotonlywhetheranstormbutalsotakeadvantageoftheprevailingconditionsSowhyisthisgroupnottalkingaboutBrexitSimplebecausetheyarebusydoinghellipbusythinkingplanningreviewingandadapting
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
15
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
thesepeoplenottalkingaboutBrexitBecauseiftheydidnrsquothaveaplanpre-referendumtheymostlikelydonrsquothaveonenowTobeblunttheyrsquorestickingtheirheadinthesandNowincaseyouthinkIrsquombeingoverlyharshtothissecondgroupletrsquosbeclearndashIhavemassivesympathyforaccidentallandlordsManyofmyclientsfallintothisgroupandtheyarenotinthispositionbecausetheychosetobeMaybetheyboughtatthepeakofthemarketandfoundthemselvesbeingunabletomovewhentheirfamilygrewOthersnodoubtownedhomespriortomeetinggirlfriendsboyfriendshusbandsandwivesOvertheyearstheadvicehasoftenbeengiventhatifyoucanrsquotselljustrentNeverthelessmypointremainsthattheydidnotactivelychoosetobeinthispositionSowhatwillhappentotheUKpropertymarketAtthetimeofwritingIamseparatedfrommycrystalball[IlentittoaWelshfootiefanandnevergotitback]soIwillrefrainfrommakingwildpredictionsHoweverIwillstatethefollowinghellipIrrespectiveofwhathappenspostreferendumthefollowingremainsunalteredhellipdemandandsupplyofhousingYesmortgageratesmaychangeandmortgagesmaybecomemoreorlessaccessiblendashindeedwemayallfeellikewehavemoreorlessmoneyinourpocketndashbutultimatelyweallstillneedsomewheretoliveInconclusionIthinkthechoiceyouhaveasapropertyinvestoriswhetheryouallowexternaleventstodictateyouractionsorwhetheryougrabthebullbythehornsandcreateyourownoutcomeIdonrsquotknowaboutyoubutIknowwhichoneIprefer
ThesecondgrouparetheaccidentallandlordsThesepeoplearenrsquotreallyinvestorsatallThisisthegroupwhoifthewindchangeswillmostsurelyfeeltheeffectsmostkeenlyWhyare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
16
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
MortgagesByMatthewJonesofMoneywatchFinance01217453347AlltoooftenpeopledecidetobuyapropertywithoutconsideringtheimportanceofgettingtheirfinancialduckslinedupWehavehadinstancesinthepastwherepeoplehavespentmanymonthssearchingfortheidealbuytoletpropertyonlyforeverythingtofallapartbecausetheyhadnrsquotdonethebasicsIwouldencourageanyinvestorlookingtobuytolettotakeacarefullookattheirowncreditreportsomethingthebankswilluseinthedecisionmakingprocessoftenmakingitthefirstthingtheycheckviaanautomatedprocessldquocomputersaysnordquoThethreecreditbureausintheUKarecurrentlyExperianEquifaxandCallCreditThefirsttwowillallowyouaccesstoyourcreditreportforthefirst28daysforfreebutwhatmanypeopledonotknowisthatCallCreditallowsyouaccesstoyourrecordsfreeofchargeforlifeviathewebsitewwwnoddlecoukWehavehelpedmanyinvestorsoverthepastfewyearsimprovetheircreditscoreHereareafewsimpleyeteffectivetipsUseyourcreditcardandclearitinfulleverymonthtohelpbuildyourcreditscoreDonrsquotuseyouroverdraftLendersnowtreatoverdraftsthesameastheywouldpaydaylendingBettertohavepound1000inyourcurrentaccountconstantlyandpound1000lessinyoursavingsaccountsMakesureyouareontheelectoralroll-againwehaveseeninvestorswithlargedepositsanddecentincomesfailthelendersinitialchecksbecausetheywerenrsquotontheelectoralrollFinallydonrsquotassumebuytoletlenderswonrsquotbeinterestedinyourincomeThingshavechangedandthemarketisalottighternowadayswithalotmore
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
17
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ReferencingThesadfactisthatevengoodtenantscanturnbadsonoamountofreferencingorcreditcheckswillcompletelyeliminateyourrisksHoweverwithacombinationofthoroughreferencingcreditchecksandtoppingitalloffwitharentguaranteeyoucertainlycanminimiseyourexposuretofinanciallossWhilstnotimpossibleitcanbedifficultforlandlordstodoacreditcheckonpotentialtenantsThisiswhymanylandlordspreferthistobedonebyalettingagentHoweverasabareminimumIwouldsuggestthatanylandlordshouldcheckthefollowing
Checkthatyourpotentialtenantcancomfortablyaffordtherent(30xmonthlyrentasanannualincomeisagoodguide)CheckwiththelandlordhowtheirprevioustenancywasconductedCheckthatpotentialtenantshavethelegalrighttoresideandrentintheUK(seenextsection)
FinallyandthisissomethingwhichmostagentswontsaytoyoubutIwillasIamalsoalandlordsoIwill-useyourgutinstinct
ImnotsayingyoucanrelyonyourgutinstincttospotagoodtenantbutifyourgutinstincttellsyouthatapotentialtenantwillbeproblematicthenyoureprobablycorrectAlotofthisboilsdowntoexperiencebutsuchthingswhichsometimesringalarmbellswithmeinclude
BeingabsolutelydesparatetomoveinOfferingtopayalargerdepositoreventhefullrentupfrontfornoapparentreasonBeingunabletoprovidefullreferencesViewingonbehalfofsomeoneelsewhoyouareunabletomeetuntilthemovein
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
18
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
19
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
20
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
21
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
22
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
4
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
depthlocalknowledgeisthepowertospotabargainOveralltheareamaybeconsideredtobealsquobadrsquoareaandhencethehousepricesconsiderablylowerbutyouknowthroughyourownresearchthatcertainpartsareactuallywellregardedlocallyIfyoucanrevealthissortoflocalknowledgeyouarelikelytodowellandwhilstyoumayneedtowaitfortherightpropertytocomealongwhenitdoesyouwillsurelybereadytopounceSohowcouldyouimproveyourlocalknowledgeHerearemytopsuggestions1GototheareayoursquoreconsideringandlookaroundforyourselfVisitatdifferenttimesofdayinthesamewayasifyouwerebuyingahouseforyourselftolivein
2MakecontactwithpeopleinthelocalareaSpeaktolocalbusinesses(cornershopsownersareoftenhappytochat)thelocalchippyevenifyoursquovegotthegutstodosostopafewpeopleatthelocalsupermarketandaskthemwherearethebestplacestoliveintheneighbourhood
3UsethewebsitewwwmousepricecomThiswebsitegivesyouallsortsofusefulinformationfromthecrimestatstothelocationofsocialhousingItreallyisavaluableresourceandshouldbeusedIwouldsayasafirstportofcallifyouaretryingtomakeaquickcomparisonofareaswhichyouhaveyettovisitBelowisanexampleofheatmapfromwwwmousepricecomshowingsocialhousingdensityinandaroundEdgbastonBirmingham
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
5
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
FindingmotivatedsellersIrsquomluckythatmostofthepeopleIspeaktoinmylineofworkarepositivego-gettersIsupposeinmanywaysinpropertyyouhavetobelikethistomakethingsworkforyouHowevernowandagainIcomeacrossoneoftheglasshalfemptysortsorlsquodoomandgloomersrsquoasIsometimesliketocallthemThesepeoplearequicktotellyouwhysomethingwonrsquotworkforthemldquoIcanrsquotgetadecentmortgageraterdquoorldquoAlltheestateagentsIspeaktoarecrookedrdquoorevenldquoTherearenrsquotanypropertydealstobehadinBirminghamanymorerdquoThelistofcomplaintsorexcusescangoonandonbuttheonethingwhichtheyallhaveincommonisthattheyarejustthathellipexcusesYouseetherearealwayswaystogetaheadofthecompetitionSomeofthemtakemoreeffortandpatiencethanothersndashonethingIalwaysrecommendtowouldbeinvestorsistogoandmeettheagentswhoareactiveintheirchosenareandashbuttherearealsoquickwins
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
6
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
SoherersquosonesuchquickwinhellipDidyouknowthatanyonecangoontoZooplaandseeonlythosepropertieslistedinthelast30daysYoudidOkayherersquosthenextbithellipDidyoualsoknowthatyoucanalsospecifytoonlyshowpropertieswhichhavebeenmarkedbytheagentasbeinglsquochainfreersquoYoudidokaysohereisthefinalbitwhichcreatesthemagichellipYoucanalsoorderthelistofpropertiesinorderoftheamountreducedSonowyouhavealistofallsellerswhoarenewtothemarketandarehighlymotivatedtosellTryitforyourselfandseewhatcomesupwhichyoumighthaveotherwisemissed
AREAFOCUS-BIRMINGHAM
WherecanyoubuyinBirminghamwithalimitedbudgetAshousepricesgouppropertyinvestorswithsmallerbudgetsarefindingitincreasinglydifficulttofindpropertiesatthelowerendofthemarketFrommyconversationswithinvestorsthepricepointwhichmostseemtoneedtobuyunderisaroundpound120000SowhatcouldyoubuyatthisfigureWellitalldependswhereyoursquorelookingbutinBirminghamthefollowingcouldbeworthconsideringastypicalexamplesofpotentiallygoodbuytoletinvestments
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
7
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BirminghamCityCentrepound120000willbuyyouastudioapartmentinvariouscitycentredevelopmentsRelativelyspeakingforthefloorspaceyougetthepriceyoupayisquitehighbutthereagainsoistherentmakingstudiosoneofthebetteryieldinginvestmentsinBirminghamCityCentreDownsideLikeallcitycentreapartmentsyoucanpayasubstantialchunkofyourrenteachmonthforgroundrentandservicecharges
MoseleyandKingsHeathAgainpound120000willputyousquarelyinflatterritorybutthistimeyouwillbelookingatonebedsratherthanstudiosIfyouareveryluckyandyoucanfindoneyoumayalsofindatwobedroommaisonettewhichneedsworkTheyieldsherewillbefairlysimilartothecitycentrebutthegroundrentspossiblylowerDownsideThereisnotquitethesamelevelofdemandforflatshereasinBirminghamCityCentre
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
8
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HarborneIfyoursquoreluckyyoumightfindaonebedroomflatinoneoftheolderblocksontheBearwoodsideofHarborneforyourbudgetorastudioapartmentifitrsquosmorecentrallylocatedRentsinHarborneremainhighsosimilaryieldstoMoseleyDownsideThemajorityoftherentalstockinHarborneisterracedhousingmakingflatshardertofindatthisprice
EdgbastonEdgbastonisamassiveareaandifsomeonesaysthataparticularpropertyisinEdgbastonthenyouneedtoactuallylookatwhereitisonthemapConceivablyitcouldlieanywherebetweenPershoreRoad(EdgbastonCricketGround)andCapeHillAvailableoptionsforyouwithabudgetofpound120000willincludebothflatsandhousesInparticularifyoulookoverontheCityHospitalsideofthearea(aroundSelseyRoadSwindonRoadetc)youwillfindarangeofterracedhousingwithinyourbudgetYieldsherewillbeonaparwithCityCentreorhighergiventhatforthemostparttherewillbenoservicechargestopayDownsideWhilsttheareamaybecalledEdgbastonitisnottheEdgbastonwhichyoumightimaginewiththesprawlinghousesandmanicuredlawns
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
9
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
RiskvsRewardWithpricesinBirminghamontheriseitrsquosunsurprisingthatmanypropertyinvestorsarestartingtolooktothesurroundingareasforcheaperpropertiesFormosttherootoftheproblemisthelargeamountofdepositrequiredbythemajorityofbuytoletlendersNowthethingisthisndash
wherevertheybuyinvestorsstillwanttoachievegoodyieldsandcapitalgrowthButasweknowifoneareaischeaperthananotheritisprobablybecauseitisnotseenasbeingasdesirableAtextremesthismaymeanthatthecalibreoftenantisnotthesameandwiththiscomesassociatedrisksThisbringsmenicelyontothesubjectofriskversusrewardYouseeyourarelygetsomethingfornothingEitheryougoforanicesafebet(sayatraditionalterracejustofftheKingsHeathhighstreet)withanaverage4yieldoryougoforsomethingmoreriskylikeaflatinanex-councilblockwitha7-10yieldNowmostlandlordsarenotsnobsafterallformostitissimplyabusinessandtheyhavelittleornoemotionalattachmenttothepropertyitselfsothethingtobearinmindwhenoptingforahigherriskstrategyistheeaseofmanagement
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
10
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhereasthemanagementofapropertyinaprimelocationmaybefairlystraightforwardandeasilytackledbythelandlordthemselvesyoumightwellcomeupagainstsomehurdleswhenlookingafterapropertyinahigherriskareaForexampleyoumayfindyourselfhavingtodealwithhousingbenefitclaimsYoumayalsohavetoacceptthatyourtenanthasmultiplesourcesofincomewhichmaymeanthattheircashflowandconsequentlyyourcashflowarenotassmoothasyoursquodbothlikeInadditionyoumaywellfindthatyourpropertysuffersmorewithwearandtearaslowerincometenantsaremorelikelytobefamiliesthancouplesorsinglepeopleThereisnorightorwronginthisitissimplyacaseofwhatyou(andifyoursquoreusingoneyourlettingagent)feelcomfortablewith
ChooseyouragentcarefullyIrsquodliketotellyouaboutsomethingwhichhappenedearlierthisweekandwhichquitefranklyastoundedmeAlandlordwhoIhaveknownforthebestpartofsixyearsbuthavenrsquotseenforaboutninemonths(youngbabyputhimoutofactionforabit)toldmeabouttheproblemshehadbeenhavingwithhislettingagentNowIrsquodjustliketosaybeforeIgoanyfurtherthatthisisnrsquotaboutanyofthelocalagentsinourareainfacttheagentconcernedisnrsquoteveninSouthBirminghamhoweverIthinkthisisapertinentlessonforanylandlordespeciallythosewithanumberofpropertieswhichtheyentrusttoasingleagentBasicallywhathadhappenedwasthatthelandlordrsquoslettingagent(whomanagedintheregionof50or60propertiesforhim)hadnotbeenpayinghimthefullrentThiswasnrsquotbecausemaintenancehadbeendoneatthepropertiesandthereforedeductedfromtherentitwassimplythecasethatthisdishonestagentassumedthatbecausethelandlordhadsomanypropertieshewouldnrsquotnoticeafewquidmissinghereorthere
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
11
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhilstIrsquodliketothinkthatiftheyweremypropertiesIwouldnoticeashortfallIcanrsquothonestlysaythatIwouldbeabletotellifIhad50ormorepropertieswithvariousrentscominginatdifferenttimesduringthemonthThelessonhereisthatanydecentagentshouldbeprovidingasamatterofcoursemonthlyemailedstatementsWhetheritrsquosforalandlordwithasinglepropertyinwhichcaseitissimplyabreakdownofrentreceivedminusfeesandmaintenanceagainstrentremittedorforalandlordwithaportfolioofpropertiesasummaryplustheindividualstatementsThankfullythelandlordinquestiongothismoneybackbutitmightnothavebeensuchahappyendingifthesituationhadgoneonforlongerandtheamountofrentindeficithadbeenhigherIndeedhadthelettingagentnotbeensolventthisisasituationwhichmayneverhavebeenputrightAndthisgotmethinkingHowmanylandlordsoutthereareunhappywiththeirlettingagentbutratherthanvotingwiththeirfeetandtakingtheirbusinesselsewhereareinsteadjustputtingupandshuttingupIfthingsarenrsquotrightwhywouldnrsquotyouchangeWhatrsquosstoppingyoufrommovingyourpropertiestoanagentwhoappreciatesyourbusinessIsitbecauseyoubelievethatmovingtoanotheragentmidtenancyissimplytoodifficulttooriskyormaybesimplythatyoudonrsquotknowhowitrsquosdoneIntruthitrsquosnotthatdifficultyoujustneedthenervetodoit
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
12
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhatrsquostheidealnumberofbedroomsOneofthequestionsIamoftenaskedbynewinvestorsiswhatistheidealnumberofbedroomsforarentalpropertyTheanswerinpartdependsonwhetheryouaretalkingabouthousesorflatsItalsodependsonwhatyourinvestmentstrategyisByinvestmentstrategyImeanwhetheryouaretryingtomaximisetheyieldforshorttermcash-floworgoingforapropertywithpotentialforgoodcapitalappreciationinthelongertermOfcourseyoumaywellbeaimingforacombinationofthetwoToanswerthequestionofhowmanybedroomsisbetterforbuytoletweneedtounderstandtheeffectthishasonboththeyieldandthecapitalappreciationWealsoneedtoacknowledgethatitwillvarybyareaandbypropertytypeLetrsquoslookatMoseleyasanexampleWewilllookatjustoneandtwobedroomflatsinMoseley
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
13
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
LetrsquosfirstlookattheaskingpricesAtaglancetheaverageaskingpricetodayofaonebedroomflatinMoseleyispound90000Incontrasttheaverageaskingpriceforatwobedispound133000SowhatabouttherentsWellbasedonwhatisadvertisedtodayonZooplaatypicalonebedroomflatisadvertisedwitharentalpriceofpound500percalendarmonthandatwobedatpound610permonthTranslatethisintoyieldsandthatrsquosayieldof66fortheonebedagainst55forthetwobedSopurelyintermsofachievableyieldstheonebedisthebetteroptionButwhataboutcapitalappreciationWellthisiswhereitgetsabitmoredifficultNormallyifIwasgoingtopredictpotentialforcapitalappreciationIwouldlooktopreviousyearsrsquogrowthasanindicatorHoweverthepastdecadehasbeenaturbulenttimeforpropertyownersandnomoresothanforthosewhoboughtflatsinMoseleyArapidincreaseinthebuildingofnewflatscoupledwiththenationwideeconomicproblemsresultedinvaluesstagnatingoreveninnegativegrowthforsomeThankfullythingsseemtohavesettledsomewhatandifyouwerebuyingaflatnowyoucoulddosowithalotmoreconfidenceAstwobedsappealbothtohomeownersandbuytoletinvestorsthesenormallyofferbothbettercapitalappreciationandareeasiertosellinthelongrunOfcourseanotheroptionwouldbetofocusinsteadonhouseswhichhavecontinuedtoappreciate
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
14
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ShouldyoubeworryingaboutBrexitUnlessyoursquovebeenlivinginacavetheselastcoupleofweeksyoursquollhavestruggledtoescapethetorrentofdiscussionsconjecturesandanalysisinthemediaofthesocalledBrexitWhetheritisrightorwrongremainstobeseenandsurelywewillonlytrulybeabletojudgewiththebenefitofhindsighthoweveronethingwhichseemstohavebeenmissedbythemainstreammediaisthepotentialimpactontheUKpropertymarketNowyoumightsaythatthereasonthishasnrsquotbeendiscussedisbecausetheeffectislargelyunknownbutIwouldsaythatthisisnotthereasonAfterallwhodoesreallyknowatthisstagetheimpactofanimpendingdivorcefromtheEUonanyspecificaspectoftheUKeconomyEventhefutureoftheNHSwhichwasamajorpointoffocusduringthepre-referendumcampaigningseemstobeinquestionSowhyhastheimpactontheUKpropertymarketnotbeensowidelydiscussedintheensuingweekssincethereferendumMyopinionisthisndashpropertyinvestorsfallintooneoftwocampsSeriousinvestorswhohaveclearlydefinedobjectivesfortheirpropertybusinessesThesepeoplehavenrsquotgotintopropertyonawhimInsteadtheyhavethoughtaboutitplannedforitandindeedtheyhaveputinplacecongruentstrategieswhichhelpthemmeettheirobjectivesSuretheymaynowbeconcernedaboutwhatmaychangeintheensuingmonthsandyearsbuttheywilllargelyadaptanddevelopnewtacticswhichwillallowthemtonotonlywhetheranstormbutalsotakeadvantageoftheprevailingconditionsSowhyisthisgroupnottalkingaboutBrexitSimplebecausetheyarebusydoinghellipbusythinkingplanningreviewingandadapting
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
15
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
thesepeoplenottalkingaboutBrexitBecauseiftheydidnrsquothaveaplanpre-referendumtheymostlikelydonrsquothaveonenowTobeblunttheyrsquorestickingtheirheadinthesandNowincaseyouthinkIrsquombeingoverlyharshtothissecondgroupletrsquosbeclearndashIhavemassivesympathyforaccidentallandlordsManyofmyclientsfallintothisgroupandtheyarenotinthispositionbecausetheychosetobeMaybetheyboughtatthepeakofthemarketandfoundthemselvesbeingunabletomovewhentheirfamilygrewOthersnodoubtownedhomespriortomeetinggirlfriendsboyfriendshusbandsandwivesOvertheyearstheadvicehasoftenbeengiventhatifyoucanrsquotselljustrentNeverthelessmypointremainsthattheydidnotactivelychoosetobeinthispositionSowhatwillhappentotheUKpropertymarketAtthetimeofwritingIamseparatedfrommycrystalball[IlentittoaWelshfootiefanandnevergotitback]soIwillrefrainfrommakingwildpredictionsHoweverIwillstatethefollowinghellipIrrespectiveofwhathappenspostreferendumthefollowingremainsunalteredhellipdemandandsupplyofhousingYesmortgageratesmaychangeandmortgagesmaybecomemoreorlessaccessiblendashindeedwemayallfeellikewehavemoreorlessmoneyinourpocketndashbutultimatelyweallstillneedsomewheretoliveInconclusionIthinkthechoiceyouhaveasapropertyinvestoriswhetheryouallowexternaleventstodictateyouractionsorwhetheryougrabthebullbythehornsandcreateyourownoutcomeIdonrsquotknowaboutyoubutIknowwhichoneIprefer
ThesecondgrouparetheaccidentallandlordsThesepeoplearenrsquotreallyinvestorsatallThisisthegroupwhoifthewindchangeswillmostsurelyfeeltheeffectsmostkeenlyWhyare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
16
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
MortgagesByMatthewJonesofMoneywatchFinance01217453347AlltoooftenpeopledecidetobuyapropertywithoutconsideringtheimportanceofgettingtheirfinancialduckslinedupWehavehadinstancesinthepastwherepeoplehavespentmanymonthssearchingfortheidealbuytoletpropertyonlyforeverythingtofallapartbecausetheyhadnrsquotdonethebasicsIwouldencourageanyinvestorlookingtobuytolettotakeacarefullookattheirowncreditreportsomethingthebankswilluseinthedecisionmakingprocessoftenmakingitthefirstthingtheycheckviaanautomatedprocessldquocomputersaysnordquoThethreecreditbureausintheUKarecurrentlyExperianEquifaxandCallCreditThefirsttwowillallowyouaccesstoyourcreditreportforthefirst28daysforfreebutwhatmanypeopledonotknowisthatCallCreditallowsyouaccesstoyourrecordsfreeofchargeforlifeviathewebsitewwwnoddlecoukWehavehelpedmanyinvestorsoverthepastfewyearsimprovetheircreditscoreHereareafewsimpleyeteffectivetipsUseyourcreditcardandclearitinfulleverymonthtohelpbuildyourcreditscoreDonrsquotuseyouroverdraftLendersnowtreatoverdraftsthesameastheywouldpaydaylendingBettertohavepound1000inyourcurrentaccountconstantlyandpound1000lessinyoursavingsaccountsMakesureyouareontheelectoralroll-againwehaveseeninvestorswithlargedepositsanddecentincomesfailthelendersinitialchecksbecausetheywerenrsquotontheelectoralrollFinallydonrsquotassumebuytoletlenderswonrsquotbeinterestedinyourincomeThingshavechangedandthemarketisalottighternowadayswithalotmore
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
17
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ReferencingThesadfactisthatevengoodtenantscanturnbadsonoamountofreferencingorcreditcheckswillcompletelyeliminateyourrisksHoweverwithacombinationofthoroughreferencingcreditchecksandtoppingitalloffwitharentguaranteeyoucertainlycanminimiseyourexposuretofinanciallossWhilstnotimpossibleitcanbedifficultforlandlordstodoacreditcheckonpotentialtenantsThisiswhymanylandlordspreferthistobedonebyalettingagentHoweverasabareminimumIwouldsuggestthatanylandlordshouldcheckthefollowing
Checkthatyourpotentialtenantcancomfortablyaffordtherent(30xmonthlyrentasanannualincomeisagoodguide)CheckwiththelandlordhowtheirprevioustenancywasconductedCheckthatpotentialtenantshavethelegalrighttoresideandrentintheUK(seenextsection)
FinallyandthisissomethingwhichmostagentswontsaytoyoubutIwillasIamalsoalandlordsoIwill-useyourgutinstinct
ImnotsayingyoucanrelyonyourgutinstincttospotagoodtenantbutifyourgutinstincttellsyouthatapotentialtenantwillbeproblematicthenyoureprobablycorrectAlotofthisboilsdowntoexperiencebutsuchthingswhichsometimesringalarmbellswithmeinclude
BeingabsolutelydesparatetomoveinOfferingtopayalargerdepositoreventhefullrentupfrontfornoapparentreasonBeingunabletoprovidefullreferencesViewingonbehalfofsomeoneelsewhoyouareunabletomeetuntilthemovein
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
18
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
19
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
20
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
21
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
5
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
FindingmotivatedsellersIrsquomluckythatmostofthepeopleIspeaktoinmylineofworkarepositivego-gettersIsupposeinmanywaysinpropertyyouhavetobelikethistomakethingsworkforyouHowevernowandagainIcomeacrossoneoftheglasshalfemptysortsorlsquodoomandgloomersrsquoasIsometimesliketocallthemThesepeoplearequicktotellyouwhysomethingwonrsquotworkforthemldquoIcanrsquotgetadecentmortgageraterdquoorldquoAlltheestateagentsIspeaktoarecrookedrdquoorevenldquoTherearenrsquotanypropertydealstobehadinBirminghamanymorerdquoThelistofcomplaintsorexcusescangoonandonbuttheonethingwhichtheyallhaveincommonisthattheyarejustthathellipexcusesYouseetherearealwayswaystogetaheadofthecompetitionSomeofthemtakemoreeffortandpatiencethanothersndashonethingIalwaysrecommendtowouldbeinvestorsistogoandmeettheagentswhoareactiveintheirchosenareandashbuttherearealsoquickwins
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
6
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
SoherersquosonesuchquickwinhellipDidyouknowthatanyonecangoontoZooplaandseeonlythosepropertieslistedinthelast30daysYoudidOkayherersquosthenextbithellipDidyoualsoknowthatyoucanalsospecifytoonlyshowpropertieswhichhavebeenmarkedbytheagentasbeinglsquochainfreersquoYoudidokaysohereisthefinalbitwhichcreatesthemagichellipYoucanalsoorderthelistofpropertiesinorderoftheamountreducedSonowyouhavealistofallsellerswhoarenewtothemarketandarehighlymotivatedtosellTryitforyourselfandseewhatcomesupwhichyoumighthaveotherwisemissed
AREAFOCUS-BIRMINGHAM
WherecanyoubuyinBirminghamwithalimitedbudgetAshousepricesgouppropertyinvestorswithsmallerbudgetsarefindingitincreasinglydifficulttofindpropertiesatthelowerendofthemarketFrommyconversationswithinvestorsthepricepointwhichmostseemtoneedtobuyunderisaroundpound120000SowhatcouldyoubuyatthisfigureWellitalldependswhereyoursquorelookingbutinBirminghamthefollowingcouldbeworthconsideringastypicalexamplesofpotentiallygoodbuytoletinvestments
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
7
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BirminghamCityCentrepound120000willbuyyouastudioapartmentinvariouscitycentredevelopmentsRelativelyspeakingforthefloorspaceyougetthepriceyoupayisquitehighbutthereagainsoistherentmakingstudiosoneofthebetteryieldinginvestmentsinBirminghamCityCentreDownsideLikeallcitycentreapartmentsyoucanpayasubstantialchunkofyourrenteachmonthforgroundrentandservicecharges
MoseleyandKingsHeathAgainpound120000willputyousquarelyinflatterritorybutthistimeyouwillbelookingatonebedsratherthanstudiosIfyouareveryluckyandyoucanfindoneyoumayalsofindatwobedroommaisonettewhichneedsworkTheyieldsherewillbefairlysimilartothecitycentrebutthegroundrentspossiblylowerDownsideThereisnotquitethesamelevelofdemandforflatshereasinBirminghamCityCentre
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
8
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HarborneIfyoursquoreluckyyoumightfindaonebedroomflatinoneoftheolderblocksontheBearwoodsideofHarborneforyourbudgetorastudioapartmentifitrsquosmorecentrallylocatedRentsinHarborneremainhighsosimilaryieldstoMoseleyDownsideThemajorityoftherentalstockinHarborneisterracedhousingmakingflatshardertofindatthisprice
EdgbastonEdgbastonisamassiveareaandifsomeonesaysthataparticularpropertyisinEdgbastonthenyouneedtoactuallylookatwhereitisonthemapConceivablyitcouldlieanywherebetweenPershoreRoad(EdgbastonCricketGround)andCapeHillAvailableoptionsforyouwithabudgetofpound120000willincludebothflatsandhousesInparticularifyoulookoverontheCityHospitalsideofthearea(aroundSelseyRoadSwindonRoadetc)youwillfindarangeofterracedhousingwithinyourbudgetYieldsherewillbeonaparwithCityCentreorhighergiventhatforthemostparttherewillbenoservicechargestopayDownsideWhilsttheareamaybecalledEdgbastonitisnottheEdgbastonwhichyoumightimaginewiththesprawlinghousesandmanicuredlawns
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
9
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
RiskvsRewardWithpricesinBirminghamontheriseitrsquosunsurprisingthatmanypropertyinvestorsarestartingtolooktothesurroundingareasforcheaperpropertiesFormosttherootoftheproblemisthelargeamountofdepositrequiredbythemajorityofbuytoletlendersNowthethingisthisndash
wherevertheybuyinvestorsstillwanttoachievegoodyieldsandcapitalgrowthButasweknowifoneareaischeaperthananotheritisprobablybecauseitisnotseenasbeingasdesirableAtextremesthismaymeanthatthecalibreoftenantisnotthesameandwiththiscomesassociatedrisksThisbringsmenicelyontothesubjectofriskversusrewardYouseeyourarelygetsomethingfornothingEitheryougoforanicesafebet(sayatraditionalterracejustofftheKingsHeathhighstreet)withanaverage4yieldoryougoforsomethingmoreriskylikeaflatinanex-councilblockwitha7-10yieldNowmostlandlordsarenotsnobsafterallformostitissimplyabusinessandtheyhavelittleornoemotionalattachmenttothepropertyitselfsothethingtobearinmindwhenoptingforahigherriskstrategyistheeaseofmanagement
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
10
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhereasthemanagementofapropertyinaprimelocationmaybefairlystraightforwardandeasilytackledbythelandlordthemselvesyoumightwellcomeupagainstsomehurdleswhenlookingafterapropertyinahigherriskareaForexampleyoumayfindyourselfhavingtodealwithhousingbenefitclaimsYoumayalsohavetoacceptthatyourtenanthasmultiplesourcesofincomewhichmaymeanthattheircashflowandconsequentlyyourcashflowarenotassmoothasyoursquodbothlikeInadditionyoumaywellfindthatyourpropertysuffersmorewithwearandtearaslowerincometenantsaremorelikelytobefamiliesthancouplesorsinglepeopleThereisnorightorwronginthisitissimplyacaseofwhatyou(andifyoursquoreusingoneyourlettingagent)feelcomfortablewith
ChooseyouragentcarefullyIrsquodliketotellyouaboutsomethingwhichhappenedearlierthisweekandwhichquitefranklyastoundedmeAlandlordwhoIhaveknownforthebestpartofsixyearsbuthavenrsquotseenforaboutninemonths(youngbabyputhimoutofactionforabit)toldmeabouttheproblemshehadbeenhavingwithhislettingagentNowIrsquodjustliketosaybeforeIgoanyfurtherthatthisisnrsquotaboutanyofthelocalagentsinourareainfacttheagentconcernedisnrsquoteveninSouthBirminghamhoweverIthinkthisisapertinentlessonforanylandlordespeciallythosewithanumberofpropertieswhichtheyentrusttoasingleagentBasicallywhathadhappenedwasthatthelandlordrsquoslettingagent(whomanagedintheregionof50or60propertiesforhim)hadnotbeenpayinghimthefullrentThiswasnrsquotbecausemaintenancehadbeendoneatthepropertiesandthereforedeductedfromtherentitwassimplythecasethatthisdishonestagentassumedthatbecausethelandlordhadsomanypropertieshewouldnrsquotnoticeafewquidmissinghereorthere
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
11
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhilstIrsquodliketothinkthatiftheyweremypropertiesIwouldnoticeashortfallIcanrsquothonestlysaythatIwouldbeabletotellifIhad50ormorepropertieswithvariousrentscominginatdifferenttimesduringthemonthThelessonhereisthatanydecentagentshouldbeprovidingasamatterofcoursemonthlyemailedstatementsWhetheritrsquosforalandlordwithasinglepropertyinwhichcaseitissimplyabreakdownofrentreceivedminusfeesandmaintenanceagainstrentremittedorforalandlordwithaportfolioofpropertiesasummaryplustheindividualstatementsThankfullythelandlordinquestiongothismoneybackbutitmightnothavebeensuchahappyendingifthesituationhadgoneonforlongerandtheamountofrentindeficithadbeenhigherIndeedhadthelettingagentnotbeensolventthisisasituationwhichmayneverhavebeenputrightAndthisgotmethinkingHowmanylandlordsoutthereareunhappywiththeirlettingagentbutratherthanvotingwiththeirfeetandtakingtheirbusinesselsewhereareinsteadjustputtingupandshuttingupIfthingsarenrsquotrightwhywouldnrsquotyouchangeWhatrsquosstoppingyoufrommovingyourpropertiestoanagentwhoappreciatesyourbusinessIsitbecauseyoubelievethatmovingtoanotheragentmidtenancyissimplytoodifficulttooriskyormaybesimplythatyoudonrsquotknowhowitrsquosdoneIntruthitrsquosnotthatdifficultyoujustneedthenervetodoit
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
12
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhatrsquostheidealnumberofbedroomsOneofthequestionsIamoftenaskedbynewinvestorsiswhatistheidealnumberofbedroomsforarentalpropertyTheanswerinpartdependsonwhetheryouaretalkingabouthousesorflatsItalsodependsonwhatyourinvestmentstrategyisByinvestmentstrategyImeanwhetheryouaretryingtomaximisetheyieldforshorttermcash-floworgoingforapropertywithpotentialforgoodcapitalappreciationinthelongertermOfcourseyoumaywellbeaimingforacombinationofthetwoToanswerthequestionofhowmanybedroomsisbetterforbuytoletweneedtounderstandtheeffectthishasonboththeyieldandthecapitalappreciationWealsoneedtoacknowledgethatitwillvarybyareaandbypropertytypeLetrsquoslookatMoseleyasanexampleWewilllookatjustoneandtwobedroomflatsinMoseley
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
13
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
LetrsquosfirstlookattheaskingpricesAtaglancetheaverageaskingpricetodayofaonebedroomflatinMoseleyispound90000Incontrasttheaverageaskingpriceforatwobedispound133000SowhatabouttherentsWellbasedonwhatisadvertisedtodayonZooplaatypicalonebedroomflatisadvertisedwitharentalpriceofpound500percalendarmonthandatwobedatpound610permonthTranslatethisintoyieldsandthatrsquosayieldof66fortheonebedagainst55forthetwobedSopurelyintermsofachievableyieldstheonebedisthebetteroptionButwhataboutcapitalappreciationWellthisiswhereitgetsabitmoredifficultNormallyifIwasgoingtopredictpotentialforcapitalappreciationIwouldlooktopreviousyearsrsquogrowthasanindicatorHoweverthepastdecadehasbeenaturbulenttimeforpropertyownersandnomoresothanforthosewhoboughtflatsinMoseleyArapidincreaseinthebuildingofnewflatscoupledwiththenationwideeconomicproblemsresultedinvaluesstagnatingoreveninnegativegrowthforsomeThankfullythingsseemtohavesettledsomewhatandifyouwerebuyingaflatnowyoucoulddosowithalotmoreconfidenceAstwobedsappealbothtohomeownersandbuytoletinvestorsthesenormallyofferbothbettercapitalappreciationandareeasiertosellinthelongrunOfcourseanotheroptionwouldbetofocusinsteadonhouseswhichhavecontinuedtoappreciate
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
14
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ShouldyoubeworryingaboutBrexitUnlessyoursquovebeenlivinginacavetheselastcoupleofweeksyoursquollhavestruggledtoescapethetorrentofdiscussionsconjecturesandanalysisinthemediaofthesocalledBrexitWhetheritisrightorwrongremainstobeseenandsurelywewillonlytrulybeabletojudgewiththebenefitofhindsighthoweveronethingwhichseemstohavebeenmissedbythemainstreammediaisthepotentialimpactontheUKpropertymarketNowyoumightsaythatthereasonthishasnrsquotbeendiscussedisbecausetheeffectislargelyunknownbutIwouldsaythatthisisnotthereasonAfterallwhodoesreallyknowatthisstagetheimpactofanimpendingdivorcefromtheEUonanyspecificaspectoftheUKeconomyEventhefutureoftheNHSwhichwasamajorpointoffocusduringthepre-referendumcampaigningseemstobeinquestionSowhyhastheimpactontheUKpropertymarketnotbeensowidelydiscussedintheensuingweekssincethereferendumMyopinionisthisndashpropertyinvestorsfallintooneoftwocampsSeriousinvestorswhohaveclearlydefinedobjectivesfortheirpropertybusinessesThesepeoplehavenrsquotgotintopropertyonawhimInsteadtheyhavethoughtaboutitplannedforitandindeedtheyhaveputinplacecongruentstrategieswhichhelpthemmeettheirobjectivesSuretheymaynowbeconcernedaboutwhatmaychangeintheensuingmonthsandyearsbuttheywilllargelyadaptanddevelopnewtacticswhichwillallowthemtonotonlywhetheranstormbutalsotakeadvantageoftheprevailingconditionsSowhyisthisgroupnottalkingaboutBrexitSimplebecausetheyarebusydoinghellipbusythinkingplanningreviewingandadapting
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
15
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
thesepeoplenottalkingaboutBrexitBecauseiftheydidnrsquothaveaplanpre-referendumtheymostlikelydonrsquothaveonenowTobeblunttheyrsquorestickingtheirheadinthesandNowincaseyouthinkIrsquombeingoverlyharshtothissecondgroupletrsquosbeclearndashIhavemassivesympathyforaccidentallandlordsManyofmyclientsfallintothisgroupandtheyarenotinthispositionbecausetheychosetobeMaybetheyboughtatthepeakofthemarketandfoundthemselvesbeingunabletomovewhentheirfamilygrewOthersnodoubtownedhomespriortomeetinggirlfriendsboyfriendshusbandsandwivesOvertheyearstheadvicehasoftenbeengiventhatifyoucanrsquotselljustrentNeverthelessmypointremainsthattheydidnotactivelychoosetobeinthispositionSowhatwillhappentotheUKpropertymarketAtthetimeofwritingIamseparatedfrommycrystalball[IlentittoaWelshfootiefanandnevergotitback]soIwillrefrainfrommakingwildpredictionsHoweverIwillstatethefollowinghellipIrrespectiveofwhathappenspostreferendumthefollowingremainsunalteredhellipdemandandsupplyofhousingYesmortgageratesmaychangeandmortgagesmaybecomemoreorlessaccessiblendashindeedwemayallfeellikewehavemoreorlessmoneyinourpocketndashbutultimatelyweallstillneedsomewheretoliveInconclusionIthinkthechoiceyouhaveasapropertyinvestoriswhetheryouallowexternaleventstodictateyouractionsorwhetheryougrabthebullbythehornsandcreateyourownoutcomeIdonrsquotknowaboutyoubutIknowwhichoneIprefer
ThesecondgrouparetheaccidentallandlordsThesepeoplearenrsquotreallyinvestorsatallThisisthegroupwhoifthewindchangeswillmostsurelyfeeltheeffectsmostkeenlyWhyare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
16
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
MortgagesByMatthewJonesofMoneywatchFinance01217453347AlltoooftenpeopledecidetobuyapropertywithoutconsideringtheimportanceofgettingtheirfinancialduckslinedupWehavehadinstancesinthepastwherepeoplehavespentmanymonthssearchingfortheidealbuytoletpropertyonlyforeverythingtofallapartbecausetheyhadnrsquotdonethebasicsIwouldencourageanyinvestorlookingtobuytolettotakeacarefullookattheirowncreditreportsomethingthebankswilluseinthedecisionmakingprocessoftenmakingitthefirstthingtheycheckviaanautomatedprocessldquocomputersaysnordquoThethreecreditbureausintheUKarecurrentlyExperianEquifaxandCallCreditThefirsttwowillallowyouaccesstoyourcreditreportforthefirst28daysforfreebutwhatmanypeopledonotknowisthatCallCreditallowsyouaccesstoyourrecordsfreeofchargeforlifeviathewebsitewwwnoddlecoukWehavehelpedmanyinvestorsoverthepastfewyearsimprovetheircreditscoreHereareafewsimpleyeteffectivetipsUseyourcreditcardandclearitinfulleverymonthtohelpbuildyourcreditscoreDonrsquotuseyouroverdraftLendersnowtreatoverdraftsthesameastheywouldpaydaylendingBettertohavepound1000inyourcurrentaccountconstantlyandpound1000lessinyoursavingsaccountsMakesureyouareontheelectoralroll-againwehaveseeninvestorswithlargedepositsanddecentincomesfailthelendersinitialchecksbecausetheywerenrsquotontheelectoralrollFinallydonrsquotassumebuytoletlenderswonrsquotbeinterestedinyourincomeThingshavechangedandthemarketisalottighternowadayswithalotmore
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
17
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ReferencingThesadfactisthatevengoodtenantscanturnbadsonoamountofreferencingorcreditcheckswillcompletelyeliminateyourrisksHoweverwithacombinationofthoroughreferencingcreditchecksandtoppingitalloffwitharentguaranteeyoucertainlycanminimiseyourexposuretofinanciallossWhilstnotimpossibleitcanbedifficultforlandlordstodoacreditcheckonpotentialtenantsThisiswhymanylandlordspreferthistobedonebyalettingagentHoweverasabareminimumIwouldsuggestthatanylandlordshouldcheckthefollowing
Checkthatyourpotentialtenantcancomfortablyaffordtherent(30xmonthlyrentasanannualincomeisagoodguide)CheckwiththelandlordhowtheirprevioustenancywasconductedCheckthatpotentialtenantshavethelegalrighttoresideandrentintheUK(seenextsection)
FinallyandthisissomethingwhichmostagentswontsaytoyoubutIwillasIamalsoalandlordsoIwill-useyourgutinstinct
ImnotsayingyoucanrelyonyourgutinstincttospotagoodtenantbutifyourgutinstincttellsyouthatapotentialtenantwillbeproblematicthenyoureprobablycorrectAlotofthisboilsdowntoexperiencebutsuchthingswhichsometimesringalarmbellswithmeinclude
BeingabsolutelydesparatetomoveinOfferingtopayalargerdepositoreventhefullrentupfrontfornoapparentreasonBeingunabletoprovidefullreferencesViewingonbehalfofsomeoneelsewhoyouareunabletomeetuntilthemovein
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
6
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
SoherersquosonesuchquickwinhellipDidyouknowthatanyonecangoontoZooplaandseeonlythosepropertieslistedinthelast30daysYoudidOkayherersquosthenextbithellipDidyoualsoknowthatyoucanalsospecifytoonlyshowpropertieswhichhavebeenmarkedbytheagentasbeinglsquochainfreersquoYoudidokaysohereisthefinalbitwhichcreatesthemagichellipYoucanalsoorderthelistofpropertiesinorderoftheamountreducedSonowyouhavealistofallsellerswhoarenewtothemarketandarehighlymotivatedtosellTryitforyourselfandseewhatcomesupwhichyoumighthaveotherwisemissed
AREAFOCUS-BIRMINGHAM
WherecanyoubuyinBirminghamwithalimitedbudgetAshousepricesgouppropertyinvestorswithsmallerbudgetsarefindingitincreasinglydifficulttofindpropertiesatthelowerendofthemarketFrommyconversationswithinvestorsthepricepointwhichmostseemtoneedtobuyunderisaroundpound120000SowhatcouldyoubuyatthisfigureWellitalldependswhereyoursquorelookingbutinBirminghamthefollowingcouldbeworthconsideringastypicalexamplesofpotentiallygoodbuytoletinvestments
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BirminghamCityCentrepound120000willbuyyouastudioapartmentinvariouscitycentredevelopmentsRelativelyspeakingforthefloorspaceyougetthepriceyoupayisquitehighbutthereagainsoistherentmakingstudiosoneofthebetteryieldinginvestmentsinBirminghamCityCentreDownsideLikeallcitycentreapartmentsyoucanpayasubstantialchunkofyourrenteachmonthforgroundrentandservicecharges
MoseleyandKingsHeathAgainpound120000willputyousquarelyinflatterritorybutthistimeyouwillbelookingatonebedsratherthanstudiosIfyouareveryluckyandyoucanfindoneyoumayalsofindatwobedroommaisonettewhichneedsworkTheyieldsherewillbefairlysimilartothecitycentrebutthegroundrentspossiblylowerDownsideThereisnotquitethesamelevelofdemandforflatshereasinBirminghamCityCentre
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
8
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HarborneIfyoursquoreluckyyoumightfindaonebedroomflatinoneoftheolderblocksontheBearwoodsideofHarborneforyourbudgetorastudioapartmentifitrsquosmorecentrallylocatedRentsinHarborneremainhighsosimilaryieldstoMoseleyDownsideThemajorityoftherentalstockinHarborneisterracedhousingmakingflatshardertofindatthisprice
EdgbastonEdgbastonisamassiveareaandifsomeonesaysthataparticularpropertyisinEdgbastonthenyouneedtoactuallylookatwhereitisonthemapConceivablyitcouldlieanywherebetweenPershoreRoad(EdgbastonCricketGround)andCapeHillAvailableoptionsforyouwithabudgetofpound120000willincludebothflatsandhousesInparticularifyoulookoverontheCityHospitalsideofthearea(aroundSelseyRoadSwindonRoadetc)youwillfindarangeofterracedhousingwithinyourbudgetYieldsherewillbeonaparwithCityCentreorhighergiventhatforthemostparttherewillbenoservicechargestopayDownsideWhilsttheareamaybecalledEdgbastonitisnottheEdgbastonwhichyoumightimaginewiththesprawlinghousesandmanicuredlawns
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
9
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
RiskvsRewardWithpricesinBirminghamontheriseitrsquosunsurprisingthatmanypropertyinvestorsarestartingtolooktothesurroundingareasforcheaperpropertiesFormosttherootoftheproblemisthelargeamountofdepositrequiredbythemajorityofbuytoletlendersNowthethingisthisndash
wherevertheybuyinvestorsstillwanttoachievegoodyieldsandcapitalgrowthButasweknowifoneareaischeaperthananotheritisprobablybecauseitisnotseenasbeingasdesirableAtextremesthismaymeanthatthecalibreoftenantisnotthesameandwiththiscomesassociatedrisksThisbringsmenicelyontothesubjectofriskversusrewardYouseeyourarelygetsomethingfornothingEitheryougoforanicesafebet(sayatraditionalterracejustofftheKingsHeathhighstreet)withanaverage4yieldoryougoforsomethingmoreriskylikeaflatinanex-councilblockwitha7-10yieldNowmostlandlordsarenotsnobsafterallformostitissimplyabusinessandtheyhavelittleornoemotionalattachmenttothepropertyitselfsothethingtobearinmindwhenoptingforahigherriskstrategyistheeaseofmanagement
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhereasthemanagementofapropertyinaprimelocationmaybefairlystraightforwardandeasilytackledbythelandlordthemselvesyoumightwellcomeupagainstsomehurdleswhenlookingafterapropertyinahigherriskareaForexampleyoumayfindyourselfhavingtodealwithhousingbenefitclaimsYoumayalsohavetoacceptthatyourtenanthasmultiplesourcesofincomewhichmaymeanthattheircashflowandconsequentlyyourcashflowarenotassmoothasyoursquodbothlikeInadditionyoumaywellfindthatyourpropertysuffersmorewithwearandtearaslowerincometenantsaremorelikelytobefamiliesthancouplesorsinglepeopleThereisnorightorwronginthisitissimplyacaseofwhatyou(andifyoursquoreusingoneyourlettingagent)feelcomfortablewith
ChooseyouragentcarefullyIrsquodliketotellyouaboutsomethingwhichhappenedearlierthisweekandwhichquitefranklyastoundedmeAlandlordwhoIhaveknownforthebestpartofsixyearsbuthavenrsquotseenforaboutninemonths(youngbabyputhimoutofactionforabit)toldmeabouttheproblemshehadbeenhavingwithhislettingagentNowIrsquodjustliketosaybeforeIgoanyfurtherthatthisisnrsquotaboutanyofthelocalagentsinourareainfacttheagentconcernedisnrsquoteveninSouthBirminghamhoweverIthinkthisisapertinentlessonforanylandlordespeciallythosewithanumberofpropertieswhichtheyentrusttoasingleagentBasicallywhathadhappenedwasthatthelandlordrsquoslettingagent(whomanagedintheregionof50or60propertiesforhim)hadnotbeenpayinghimthefullrentThiswasnrsquotbecausemaintenancehadbeendoneatthepropertiesandthereforedeductedfromtherentitwassimplythecasethatthisdishonestagentassumedthatbecausethelandlordhadsomanypropertieshewouldnrsquotnoticeafewquidmissinghereorthere
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
11
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhilstIrsquodliketothinkthatiftheyweremypropertiesIwouldnoticeashortfallIcanrsquothonestlysaythatIwouldbeabletotellifIhad50ormorepropertieswithvariousrentscominginatdifferenttimesduringthemonthThelessonhereisthatanydecentagentshouldbeprovidingasamatterofcoursemonthlyemailedstatementsWhetheritrsquosforalandlordwithasinglepropertyinwhichcaseitissimplyabreakdownofrentreceivedminusfeesandmaintenanceagainstrentremittedorforalandlordwithaportfolioofpropertiesasummaryplustheindividualstatementsThankfullythelandlordinquestiongothismoneybackbutitmightnothavebeensuchahappyendingifthesituationhadgoneonforlongerandtheamountofrentindeficithadbeenhigherIndeedhadthelettingagentnotbeensolventthisisasituationwhichmayneverhavebeenputrightAndthisgotmethinkingHowmanylandlordsoutthereareunhappywiththeirlettingagentbutratherthanvotingwiththeirfeetandtakingtheirbusinesselsewhereareinsteadjustputtingupandshuttingupIfthingsarenrsquotrightwhywouldnrsquotyouchangeWhatrsquosstoppingyoufrommovingyourpropertiestoanagentwhoappreciatesyourbusinessIsitbecauseyoubelievethatmovingtoanotheragentmidtenancyissimplytoodifficulttooriskyormaybesimplythatyoudonrsquotknowhowitrsquosdoneIntruthitrsquosnotthatdifficultyoujustneedthenervetodoit
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
12
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhatrsquostheidealnumberofbedroomsOneofthequestionsIamoftenaskedbynewinvestorsiswhatistheidealnumberofbedroomsforarentalpropertyTheanswerinpartdependsonwhetheryouaretalkingabouthousesorflatsItalsodependsonwhatyourinvestmentstrategyisByinvestmentstrategyImeanwhetheryouaretryingtomaximisetheyieldforshorttermcash-floworgoingforapropertywithpotentialforgoodcapitalappreciationinthelongertermOfcourseyoumaywellbeaimingforacombinationofthetwoToanswerthequestionofhowmanybedroomsisbetterforbuytoletweneedtounderstandtheeffectthishasonboththeyieldandthecapitalappreciationWealsoneedtoacknowledgethatitwillvarybyareaandbypropertytypeLetrsquoslookatMoseleyasanexampleWewilllookatjustoneandtwobedroomflatsinMoseley
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
13
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
LetrsquosfirstlookattheaskingpricesAtaglancetheaverageaskingpricetodayofaonebedroomflatinMoseleyispound90000Incontrasttheaverageaskingpriceforatwobedispound133000SowhatabouttherentsWellbasedonwhatisadvertisedtodayonZooplaatypicalonebedroomflatisadvertisedwitharentalpriceofpound500percalendarmonthandatwobedatpound610permonthTranslatethisintoyieldsandthatrsquosayieldof66fortheonebedagainst55forthetwobedSopurelyintermsofachievableyieldstheonebedisthebetteroptionButwhataboutcapitalappreciationWellthisiswhereitgetsabitmoredifficultNormallyifIwasgoingtopredictpotentialforcapitalappreciationIwouldlooktopreviousyearsrsquogrowthasanindicatorHoweverthepastdecadehasbeenaturbulenttimeforpropertyownersandnomoresothanforthosewhoboughtflatsinMoseleyArapidincreaseinthebuildingofnewflatscoupledwiththenationwideeconomicproblemsresultedinvaluesstagnatingoreveninnegativegrowthforsomeThankfullythingsseemtohavesettledsomewhatandifyouwerebuyingaflatnowyoucoulddosowithalotmoreconfidenceAstwobedsappealbothtohomeownersandbuytoletinvestorsthesenormallyofferbothbettercapitalappreciationandareeasiertosellinthelongrunOfcourseanotheroptionwouldbetofocusinsteadonhouseswhichhavecontinuedtoappreciate
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
14
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ShouldyoubeworryingaboutBrexitUnlessyoursquovebeenlivinginacavetheselastcoupleofweeksyoursquollhavestruggledtoescapethetorrentofdiscussionsconjecturesandanalysisinthemediaofthesocalledBrexitWhetheritisrightorwrongremainstobeseenandsurelywewillonlytrulybeabletojudgewiththebenefitofhindsighthoweveronethingwhichseemstohavebeenmissedbythemainstreammediaisthepotentialimpactontheUKpropertymarketNowyoumightsaythatthereasonthishasnrsquotbeendiscussedisbecausetheeffectislargelyunknownbutIwouldsaythatthisisnotthereasonAfterallwhodoesreallyknowatthisstagetheimpactofanimpendingdivorcefromtheEUonanyspecificaspectoftheUKeconomyEventhefutureoftheNHSwhichwasamajorpointoffocusduringthepre-referendumcampaigningseemstobeinquestionSowhyhastheimpactontheUKpropertymarketnotbeensowidelydiscussedintheensuingweekssincethereferendumMyopinionisthisndashpropertyinvestorsfallintooneoftwocampsSeriousinvestorswhohaveclearlydefinedobjectivesfortheirpropertybusinessesThesepeoplehavenrsquotgotintopropertyonawhimInsteadtheyhavethoughtaboutitplannedforitandindeedtheyhaveputinplacecongruentstrategieswhichhelpthemmeettheirobjectivesSuretheymaynowbeconcernedaboutwhatmaychangeintheensuingmonthsandyearsbuttheywilllargelyadaptanddevelopnewtacticswhichwillallowthemtonotonlywhetheranstormbutalsotakeadvantageoftheprevailingconditionsSowhyisthisgroupnottalkingaboutBrexitSimplebecausetheyarebusydoinghellipbusythinkingplanningreviewingandadapting
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
thesepeoplenottalkingaboutBrexitBecauseiftheydidnrsquothaveaplanpre-referendumtheymostlikelydonrsquothaveonenowTobeblunttheyrsquorestickingtheirheadinthesandNowincaseyouthinkIrsquombeingoverlyharshtothissecondgroupletrsquosbeclearndashIhavemassivesympathyforaccidentallandlordsManyofmyclientsfallintothisgroupandtheyarenotinthispositionbecausetheychosetobeMaybetheyboughtatthepeakofthemarketandfoundthemselvesbeingunabletomovewhentheirfamilygrewOthersnodoubtownedhomespriortomeetinggirlfriendsboyfriendshusbandsandwivesOvertheyearstheadvicehasoftenbeengiventhatifyoucanrsquotselljustrentNeverthelessmypointremainsthattheydidnotactivelychoosetobeinthispositionSowhatwillhappentotheUKpropertymarketAtthetimeofwritingIamseparatedfrommycrystalball[IlentittoaWelshfootiefanandnevergotitback]soIwillrefrainfrommakingwildpredictionsHoweverIwillstatethefollowinghellipIrrespectiveofwhathappenspostreferendumthefollowingremainsunalteredhellipdemandandsupplyofhousingYesmortgageratesmaychangeandmortgagesmaybecomemoreorlessaccessiblendashindeedwemayallfeellikewehavemoreorlessmoneyinourpocketndashbutultimatelyweallstillneedsomewheretoliveInconclusionIthinkthechoiceyouhaveasapropertyinvestoriswhetheryouallowexternaleventstodictateyouractionsorwhetheryougrabthebullbythehornsandcreateyourownoutcomeIdonrsquotknowaboutyoubutIknowwhichoneIprefer
ThesecondgrouparetheaccidentallandlordsThesepeoplearenrsquotreallyinvestorsatallThisisthegroupwhoifthewindchangeswillmostsurelyfeeltheeffectsmostkeenlyWhyare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
16
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
MortgagesByMatthewJonesofMoneywatchFinance01217453347AlltoooftenpeopledecidetobuyapropertywithoutconsideringtheimportanceofgettingtheirfinancialduckslinedupWehavehadinstancesinthepastwherepeoplehavespentmanymonthssearchingfortheidealbuytoletpropertyonlyforeverythingtofallapartbecausetheyhadnrsquotdonethebasicsIwouldencourageanyinvestorlookingtobuytolettotakeacarefullookattheirowncreditreportsomethingthebankswilluseinthedecisionmakingprocessoftenmakingitthefirstthingtheycheckviaanautomatedprocessldquocomputersaysnordquoThethreecreditbureausintheUKarecurrentlyExperianEquifaxandCallCreditThefirsttwowillallowyouaccesstoyourcreditreportforthefirst28daysforfreebutwhatmanypeopledonotknowisthatCallCreditallowsyouaccesstoyourrecordsfreeofchargeforlifeviathewebsitewwwnoddlecoukWehavehelpedmanyinvestorsoverthepastfewyearsimprovetheircreditscoreHereareafewsimpleyeteffectivetipsUseyourcreditcardandclearitinfulleverymonthtohelpbuildyourcreditscoreDonrsquotuseyouroverdraftLendersnowtreatoverdraftsthesameastheywouldpaydaylendingBettertohavepound1000inyourcurrentaccountconstantlyandpound1000lessinyoursavingsaccountsMakesureyouareontheelectoralroll-againwehaveseeninvestorswithlargedepositsanddecentincomesfailthelendersinitialchecksbecausetheywerenrsquotontheelectoralrollFinallydonrsquotassumebuytoletlenderswonrsquotbeinterestedinyourincomeThingshavechangedandthemarketisalottighternowadayswithalotmore
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
17
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ReferencingThesadfactisthatevengoodtenantscanturnbadsonoamountofreferencingorcreditcheckswillcompletelyeliminateyourrisksHoweverwithacombinationofthoroughreferencingcreditchecksandtoppingitalloffwitharentguaranteeyoucertainlycanminimiseyourexposuretofinanciallossWhilstnotimpossibleitcanbedifficultforlandlordstodoacreditcheckonpotentialtenantsThisiswhymanylandlordspreferthistobedonebyalettingagentHoweverasabareminimumIwouldsuggestthatanylandlordshouldcheckthefollowing
Checkthatyourpotentialtenantcancomfortablyaffordtherent(30xmonthlyrentasanannualincomeisagoodguide)CheckwiththelandlordhowtheirprevioustenancywasconductedCheckthatpotentialtenantshavethelegalrighttoresideandrentintheUK(seenextsection)
FinallyandthisissomethingwhichmostagentswontsaytoyoubutIwillasIamalsoalandlordsoIwill-useyourgutinstinct
ImnotsayingyoucanrelyonyourgutinstincttospotagoodtenantbutifyourgutinstincttellsyouthatapotentialtenantwillbeproblematicthenyoureprobablycorrectAlotofthisboilsdowntoexperiencebutsuchthingswhichsometimesringalarmbellswithmeinclude
BeingabsolutelydesparatetomoveinOfferingtopayalargerdepositoreventhefullrentupfrontfornoapparentreasonBeingunabletoprovidefullreferencesViewingonbehalfofsomeoneelsewhoyouareunabletomeetuntilthemovein
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
19
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
7
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BirminghamCityCentrepound120000willbuyyouastudioapartmentinvariouscitycentredevelopmentsRelativelyspeakingforthefloorspaceyougetthepriceyoupayisquitehighbutthereagainsoistherentmakingstudiosoneofthebetteryieldinginvestmentsinBirminghamCityCentreDownsideLikeallcitycentreapartmentsyoucanpayasubstantialchunkofyourrenteachmonthforgroundrentandservicecharges
MoseleyandKingsHeathAgainpound120000willputyousquarelyinflatterritorybutthistimeyouwillbelookingatonebedsratherthanstudiosIfyouareveryluckyandyoucanfindoneyoumayalsofindatwobedroommaisonettewhichneedsworkTheyieldsherewillbefairlysimilartothecitycentrebutthegroundrentspossiblylowerDownsideThereisnotquitethesamelevelofdemandforflatshereasinBirminghamCityCentre
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
8
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HarborneIfyoursquoreluckyyoumightfindaonebedroomflatinoneoftheolderblocksontheBearwoodsideofHarborneforyourbudgetorastudioapartmentifitrsquosmorecentrallylocatedRentsinHarborneremainhighsosimilaryieldstoMoseleyDownsideThemajorityoftherentalstockinHarborneisterracedhousingmakingflatshardertofindatthisprice
EdgbastonEdgbastonisamassiveareaandifsomeonesaysthataparticularpropertyisinEdgbastonthenyouneedtoactuallylookatwhereitisonthemapConceivablyitcouldlieanywherebetweenPershoreRoad(EdgbastonCricketGround)andCapeHillAvailableoptionsforyouwithabudgetofpound120000willincludebothflatsandhousesInparticularifyoulookoverontheCityHospitalsideofthearea(aroundSelseyRoadSwindonRoadetc)youwillfindarangeofterracedhousingwithinyourbudgetYieldsherewillbeonaparwithCityCentreorhighergiventhatforthemostparttherewillbenoservicechargestopayDownsideWhilsttheareamaybecalledEdgbastonitisnottheEdgbastonwhichyoumightimaginewiththesprawlinghousesandmanicuredlawns
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
9
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
RiskvsRewardWithpricesinBirminghamontheriseitrsquosunsurprisingthatmanypropertyinvestorsarestartingtolooktothesurroundingareasforcheaperpropertiesFormosttherootoftheproblemisthelargeamountofdepositrequiredbythemajorityofbuytoletlendersNowthethingisthisndash
wherevertheybuyinvestorsstillwanttoachievegoodyieldsandcapitalgrowthButasweknowifoneareaischeaperthananotheritisprobablybecauseitisnotseenasbeingasdesirableAtextremesthismaymeanthatthecalibreoftenantisnotthesameandwiththiscomesassociatedrisksThisbringsmenicelyontothesubjectofriskversusrewardYouseeyourarelygetsomethingfornothingEitheryougoforanicesafebet(sayatraditionalterracejustofftheKingsHeathhighstreet)withanaverage4yieldoryougoforsomethingmoreriskylikeaflatinanex-councilblockwitha7-10yieldNowmostlandlordsarenotsnobsafterallformostitissimplyabusinessandtheyhavelittleornoemotionalattachmenttothepropertyitselfsothethingtobearinmindwhenoptingforahigherriskstrategyistheeaseofmanagement
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhereasthemanagementofapropertyinaprimelocationmaybefairlystraightforwardandeasilytackledbythelandlordthemselvesyoumightwellcomeupagainstsomehurdleswhenlookingafterapropertyinahigherriskareaForexampleyoumayfindyourselfhavingtodealwithhousingbenefitclaimsYoumayalsohavetoacceptthatyourtenanthasmultiplesourcesofincomewhichmaymeanthattheircashflowandconsequentlyyourcashflowarenotassmoothasyoursquodbothlikeInadditionyoumaywellfindthatyourpropertysuffersmorewithwearandtearaslowerincometenantsaremorelikelytobefamiliesthancouplesorsinglepeopleThereisnorightorwronginthisitissimplyacaseofwhatyou(andifyoursquoreusingoneyourlettingagent)feelcomfortablewith
ChooseyouragentcarefullyIrsquodliketotellyouaboutsomethingwhichhappenedearlierthisweekandwhichquitefranklyastoundedmeAlandlordwhoIhaveknownforthebestpartofsixyearsbuthavenrsquotseenforaboutninemonths(youngbabyputhimoutofactionforabit)toldmeabouttheproblemshehadbeenhavingwithhislettingagentNowIrsquodjustliketosaybeforeIgoanyfurtherthatthisisnrsquotaboutanyofthelocalagentsinourareainfacttheagentconcernedisnrsquoteveninSouthBirminghamhoweverIthinkthisisapertinentlessonforanylandlordespeciallythosewithanumberofpropertieswhichtheyentrusttoasingleagentBasicallywhathadhappenedwasthatthelandlordrsquoslettingagent(whomanagedintheregionof50or60propertiesforhim)hadnotbeenpayinghimthefullrentThiswasnrsquotbecausemaintenancehadbeendoneatthepropertiesandthereforedeductedfromtherentitwassimplythecasethatthisdishonestagentassumedthatbecausethelandlordhadsomanypropertieshewouldnrsquotnoticeafewquidmissinghereorthere
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
11
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhilstIrsquodliketothinkthatiftheyweremypropertiesIwouldnoticeashortfallIcanrsquothonestlysaythatIwouldbeabletotellifIhad50ormorepropertieswithvariousrentscominginatdifferenttimesduringthemonthThelessonhereisthatanydecentagentshouldbeprovidingasamatterofcoursemonthlyemailedstatementsWhetheritrsquosforalandlordwithasinglepropertyinwhichcaseitissimplyabreakdownofrentreceivedminusfeesandmaintenanceagainstrentremittedorforalandlordwithaportfolioofpropertiesasummaryplustheindividualstatementsThankfullythelandlordinquestiongothismoneybackbutitmightnothavebeensuchahappyendingifthesituationhadgoneonforlongerandtheamountofrentindeficithadbeenhigherIndeedhadthelettingagentnotbeensolventthisisasituationwhichmayneverhavebeenputrightAndthisgotmethinkingHowmanylandlordsoutthereareunhappywiththeirlettingagentbutratherthanvotingwiththeirfeetandtakingtheirbusinesselsewhereareinsteadjustputtingupandshuttingupIfthingsarenrsquotrightwhywouldnrsquotyouchangeWhatrsquosstoppingyoufrommovingyourpropertiestoanagentwhoappreciatesyourbusinessIsitbecauseyoubelievethatmovingtoanotheragentmidtenancyissimplytoodifficulttooriskyormaybesimplythatyoudonrsquotknowhowitrsquosdoneIntruthitrsquosnotthatdifficultyoujustneedthenervetodoit
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
12
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhatrsquostheidealnumberofbedroomsOneofthequestionsIamoftenaskedbynewinvestorsiswhatistheidealnumberofbedroomsforarentalpropertyTheanswerinpartdependsonwhetheryouaretalkingabouthousesorflatsItalsodependsonwhatyourinvestmentstrategyisByinvestmentstrategyImeanwhetheryouaretryingtomaximisetheyieldforshorttermcash-floworgoingforapropertywithpotentialforgoodcapitalappreciationinthelongertermOfcourseyoumaywellbeaimingforacombinationofthetwoToanswerthequestionofhowmanybedroomsisbetterforbuytoletweneedtounderstandtheeffectthishasonboththeyieldandthecapitalappreciationWealsoneedtoacknowledgethatitwillvarybyareaandbypropertytypeLetrsquoslookatMoseleyasanexampleWewilllookatjustoneandtwobedroomflatsinMoseley
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
13
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
LetrsquosfirstlookattheaskingpricesAtaglancetheaverageaskingpricetodayofaonebedroomflatinMoseleyispound90000Incontrasttheaverageaskingpriceforatwobedispound133000SowhatabouttherentsWellbasedonwhatisadvertisedtodayonZooplaatypicalonebedroomflatisadvertisedwitharentalpriceofpound500percalendarmonthandatwobedatpound610permonthTranslatethisintoyieldsandthatrsquosayieldof66fortheonebedagainst55forthetwobedSopurelyintermsofachievableyieldstheonebedisthebetteroptionButwhataboutcapitalappreciationWellthisiswhereitgetsabitmoredifficultNormallyifIwasgoingtopredictpotentialforcapitalappreciationIwouldlooktopreviousyearsrsquogrowthasanindicatorHoweverthepastdecadehasbeenaturbulenttimeforpropertyownersandnomoresothanforthosewhoboughtflatsinMoseleyArapidincreaseinthebuildingofnewflatscoupledwiththenationwideeconomicproblemsresultedinvaluesstagnatingoreveninnegativegrowthforsomeThankfullythingsseemtohavesettledsomewhatandifyouwerebuyingaflatnowyoucoulddosowithalotmoreconfidenceAstwobedsappealbothtohomeownersandbuytoletinvestorsthesenormallyofferbothbettercapitalappreciationandareeasiertosellinthelongrunOfcourseanotheroptionwouldbetofocusinsteadonhouseswhichhavecontinuedtoappreciate
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
14
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ShouldyoubeworryingaboutBrexitUnlessyoursquovebeenlivinginacavetheselastcoupleofweeksyoursquollhavestruggledtoescapethetorrentofdiscussionsconjecturesandanalysisinthemediaofthesocalledBrexitWhetheritisrightorwrongremainstobeseenandsurelywewillonlytrulybeabletojudgewiththebenefitofhindsighthoweveronethingwhichseemstohavebeenmissedbythemainstreammediaisthepotentialimpactontheUKpropertymarketNowyoumightsaythatthereasonthishasnrsquotbeendiscussedisbecausetheeffectislargelyunknownbutIwouldsaythatthisisnotthereasonAfterallwhodoesreallyknowatthisstagetheimpactofanimpendingdivorcefromtheEUonanyspecificaspectoftheUKeconomyEventhefutureoftheNHSwhichwasamajorpointoffocusduringthepre-referendumcampaigningseemstobeinquestionSowhyhastheimpactontheUKpropertymarketnotbeensowidelydiscussedintheensuingweekssincethereferendumMyopinionisthisndashpropertyinvestorsfallintooneoftwocampsSeriousinvestorswhohaveclearlydefinedobjectivesfortheirpropertybusinessesThesepeoplehavenrsquotgotintopropertyonawhimInsteadtheyhavethoughtaboutitplannedforitandindeedtheyhaveputinplacecongruentstrategieswhichhelpthemmeettheirobjectivesSuretheymaynowbeconcernedaboutwhatmaychangeintheensuingmonthsandyearsbuttheywilllargelyadaptanddevelopnewtacticswhichwillallowthemtonotonlywhetheranstormbutalsotakeadvantageoftheprevailingconditionsSowhyisthisgroupnottalkingaboutBrexitSimplebecausetheyarebusydoinghellipbusythinkingplanningreviewingandadapting
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
15
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
thesepeoplenottalkingaboutBrexitBecauseiftheydidnrsquothaveaplanpre-referendumtheymostlikelydonrsquothaveonenowTobeblunttheyrsquorestickingtheirheadinthesandNowincaseyouthinkIrsquombeingoverlyharshtothissecondgroupletrsquosbeclearndashIhavemassivesympathyforaccidentallandlordsManyofmyclientsfallintothisgroupandtheyarenotinthispositionbecausetheychosetobeMaybetheyboughtatthepeakofthemarketandfoundthemselvesbeingunabletomovewhentheirfamilygrewOthersnodoubtownedhomespriortomeetinggirlfriendsboyfriendshusbandsandwivesOvertheyearstheadvicehasoftenbeengiventhatifyoucanrsquotselljustrentNeverthelessmypointremainsthattheydidnotactivelychoosetobeinthispositionSowhatwillhappentotheUKpropertymarketAtthetimeofwritingIamseparatedfrommycrystalball[IlentittoaWelshfootiefanandnevergotitback]soIwillrefrainfrommakingwildpredictionsHoweverIwillstatethefollowinghellipIrrespectiveofwhathappenspostreferendumthefollowingremainsunalteredhellipdemandandsupplyofhousingYesmortgageratesmaychangeandmortgagesmaybecomemoreorlessaccessiblendashindeedwemayallfeellikewehavemoreorlessmoneyinourpocketndashbutultimatelyweallstillneedsomewheretoliveInconclusionIthinkthechoiceyouhaveasapropertyinvestoriswhetheryouallowexternaleventstodictateyouractionsorwhetheryougrabthebullbythehornsandcreateyourownoutcomeIdonrsquotknowaboutyoubutIknowwhichoneIprefer
ThesecondgrouparetheaccidentallandlordsThesepeoplearenrsquotreallyinvestorsatallThisisthegroupwhoifthewindchangeswillmostsurelyfeeltheeffectsmostkeenlyWhyare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
16
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
MortgagesByMatthewJonesofMoneywatchFinance01217453347AlltoooftenpeopledecidetobuyapropertywithoutconsideringtheimportanceofgettingtheirfinancialduckslinedupWehavehadinstancesinthepastwherepeoplehavespentmanymonthssearchingfortheidealbuytoletpropertyonlyforeverythingtofallapartbecausetheyhadnrsquotdonethebasicsIwouldencourageanyinvestorlookingtobuytolettotakeacarefullookattheirowncreditreportsomethingthebankswilluseinthedecisionmakingprocessoftenmakingitthefirstthingtheycheckviaanautomatedprocessldquocomputersaysnordquoThethreecreditbureausintheUKarecurrentlyExperianEquifaxandCallCreditThefirsttwowillallowyouaccesstoyourcreditreportforthefirst28daysforfreebutwhatmanypeopledonotknowisthatCallCreditallowsyouaccesstoyourrecordsfreeofchargeforlifeviathewebsitewwwnoddlecoukWehavehelpedmanyinvestorsoverthepastfewyearsimprovetheircreditscoreHereareafewsimpleyeteffectivetipsUseyourcreditcardandclearitinfulleverymonthtohelpbuildyourcreditscoreDonrsquotuseyouroverdraftLendersnowtreatoverdraftsthesameastheywouldpaydaylendingBettertohavepound1000inyourcurrentaccountconstantlyandpound1000lessinyoursavingsaccountsMakesureyouareontheelectoralroll-againwehaveseeninvestorswithlargedepositsanddecentincomesfailthelendersinitialchecksbecausetheywerenrsquotontheelectoralrollFinallydonrsquotassumebuytoletlenderswonrsquotbeinterestedinyourincomeThingshavechangedandthemarketisalottighternowadayswithalotmore
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
17
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ReferencingThesadfactisthatevengoodtenantscanturnbadsonoamountofreferencingorcreditcheckswillcompletelyeliminateyourrisksHoweverwithacombinationofthoroughreferencingcreditchecksandtoppingitalloffwitharentguaranteeyoucertainlycanminimiseyourexposuretofinanciallossWhilstnotimpossibleitcanbedifficultforlandlordstodoacreditcheckonpotentialtenantsThisiswhymanylandlordspreferthistobedonebyalettingagentHoweverasabareminimumIwouldsuggestthatanylandlordshouldcheckthefollowing
Checkthatyourpotentialtenantcancomfortablyaffordtherent(30xmonthlyrentasanannualincomeisagoodguide)CheckwiththelandlordhowtheirprevioustenancywasconductedCheckthatpotentialtenantshavethelegalrighttoresideandrentintheUK(seenextsection)
FinallyandthisissomethingwhichmostagentswontsaytoyoubutIwillasIamalsoalandlordsoIwill-useyourgutinstinct
ImnotsayingyoucanrelyonyourgutinstincttospotagoodtenantbutifyourgutinstincttellsyouthatapotentialtenantwillbeproblematicthenyoureprobablycorrectAlotofthisboilsdowntoexperiencebutsuchthingswhichsometimesringalarmbellswithmeinclude
BeingabsolutelydesparatetomoveinOfferingtopayalargerdepositoreventhefullrentupfrontfornoapparentreasonBeingunabletoprovidefullreferencesViewingonbehalfofsomeoneelsewhoyouareunabletomeetuntilthemovein
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
18
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
19
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
20
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
21
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
22
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
8
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HarborneIfyoursquoreluckyyoumightfindaonebedroomflatinoneoftheolderblocksontheBearwoodsideofHarborneforyourbudgetorastudioapartmentifitrsquosmorecentrallylocatedRentsinHarborneremainhighsosimilaryieldstoMoseleyDownsideThemajorityoftherentalstockinHarborneisterracedhousingmakingflatshardertofindatthisprice
EdgbastonEdgbastonisamassiveareaandifsomeonesaysthataparticularpropertyisinEdgbastonthenyouneedtoactuallylookatwhereitisonthemapConceivablyitcouldlieanywherebetweenPershoreRoad(EdgbastonCricketGround)andCapeHillAvailableoptionsforyouwithabudgetofpound120000willincludebothflatsandhousesInparticularifyoulookoverontheCityHospitalsideofthearea(aroundSelseyRoadSwindonRoadetc)youwillfindarangeofterracedhousingwithinyourbudgetYieldsherewillbeonaparwithCityCentreorhighergiventhatforthemostparttherewillbenoservicechargestopayDownsideWhilsttheareamaybecalledEdgbastonitisnottheEdgbastonwhichyoumightimaginewiththesprawlinghousesandmanicuredlawns
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
9
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
RiskvsRewardWithpricesinBirminghamontheriseitrsquosunsurprisingthatmanypropertyinvestorsarestartingtolooktothesurroundingareasforcheaperpropertiesFormosttherootoftheproblemisthelargeamountofdepositrequiredbythemajorityofbuytoletlendersNowthethingisthisndash
wherevertheybuyinvestorsstillwanttoachievegoodyieldsandcapitalgrowthButasweknowifoneareaischeaperthananotheritisprobablybecauseitisnotseenasbeingasdesirableAtextremesthismaymeanthatthecalibreoftenantisnotthesameandwiththiscomesassociatedrisksThisbringsmenicelyontothesubjectofriskversusrewardYouseeyourarelygetsomethingfornothingEitheryougoforanicesafebet(sayatraditionalterracejustofftheKingsHeathhighstreet)withanaverage4yieldoryougoforsomethingmoreriskylikeaflatinanex-councilblockwitha7-10yieldNowmostlandlordsarenotsnobsafterallformostitissimplyabusinessandtheyhavelittleornoemotionalattachmenttothepropertyitselfsothethingtobearinmindwhenoptingforahigherriskstrategyistheeaseofmanagement
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
10
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhereasthemanagementofapropertyinaprimelocationmaybefairlystraightforwardandeasilytackledbythelandlordthemselvesyoumightwellcomeupagainstsomehurdleswhenlookingafterapropertyinahigherriskareaForexampleyoumayfindyourselfhavingtodealwithhousingbenefitclaimsYoumayalsohavetoacceptthatyourtenanthasmultiplesourcesofincomewhichmaymeanthattheircashflowandconsequentlyyourcashflowarenotassmoothasyoursquodbothlikeInadditionyoumaywellfindthatyourpropertysuffersmorewithwearandtearaslowerincometenantsaremorelikelytobefamiliesthancouplesorsinglepeopleThereisnorightorwronginthisitissimplyacaseofwhatyou(andifyoursquoreusingoneyourlettingagent)feelcomfortablewith
ChooseyouragentcarefullyIrsquodliketotellyouaboutsomethingwhichhappenedearlierthisweekandwhichquitefranklyastoundedmeAlandlordwhoIhaveknownforthebestpartofsixyearsbuthavenrsquotseenforaboutninemonths(youngbabyputhimoutofactionforabit)toldmeabouttheproblemshehadbeenhavingwithhislettingagentNowIrsquodjustliketosaybeforeIgoanyfurtherthatthisisnrsquotaboutanyofthelocalagentsinourareainfacttheagentconcernedisnrsquoteveninSouthBirminghamhoweverIthinkthisisapertinentlessonforanylandlordespeciallythosewithanumberofpropertieswhichtheyentrusttoasingleagentBasicallywhathadhappenedwasthatthelandlordrsquoslettingagent(whomanagedintheregionof50or60propertiesforhim)hadnotbeenpayinghimthefullrentThiswasnrsquotbecausemaintenancehadbeendoneatthepropertiesandthereforedeductedfromtherentitwassimplythecasethatthisdishonestagentassumedthatbecausethelandlordhadsomanypropertieshewouldnrsquotnoticeafewquidmissinghereorthere
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
11
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhilstIrsquodliketothinkthatiftheyweremypropertiesIwouldnoticeashortfallIcanrsquothonestlysaythatIwouldbeabletotellifIhad50ormorepropertieswithvariousrentscominginatdifferenttimesduringthemonthThelessonhereisthatanydecentagentshouldbeprovidingasamatterofcoursemonthlyemailedstatementsWhetheritrsquosforalandlordwithasinglepropertyinwhichcaseitissimplyabreakdownofrentreceivedminusfeesandmaintenanceagainstrentremittedorforalandlordwithaportfolioofpropertiesasummaryplustheindividualstatementsThankfullythelandlordinquestiongothismoneybackbutitmightnothavebeensuchahappyendingifthesituationhadgoneonforlongerandtheamountofrentindeficithadbeenhigherIndeedhadthelettingagentnotbeensolventthisisasituationwhichmayneverhavebeenputrightAndthisgotmethinkingHowmanylandlordsoutthereareunhappywiththeirlettingagentbutratherthanvotingwiththeirfeetandtakingtheirbusinesselsewhereareinsteadjustputtingupandshuttingupIfthingsarenrsquotrightwhywouldnrsquotyouchangeWhatrsquosstoppingyoufrommovingyourpropertiestoanagentwhoappreciatesyourbusinessIsitbecauseyoubelievethatmovingtoanotheragentmidtenancyissimplytoodifficulttooriskyormaybesimplythatyoudonrsquotknowhowitrsquosdoneIntruthitrsquosnotthatdifficultyoujustneedthenervetodoit
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
12
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhatrsquostheidealnumberofbedroomsOneofthequestionsIamoftenaskedbynewinvestorsiswhatistheidealnumberofbedroomsforarentalpropertyTheanswerinpartdependsonwhetheryouaretalkingabouthousesorflatsItalsodependsonwhatyourinvestmentstrategyisByinvestmentstrategyImeanwhetheryouaretryingtomaximisetheyieldforshorttermcash-floworgoingforapropertywithpotentialforgoodcapitalappreciationinthelongertermOfcourseyoumaywellbeaimingforacombinationofthetwoToanswerthequestionofhowmanybedroomsisbetterforbuytoletweneedtounderstandtheeffectthishasonboththeyieldandthecapitalappreciationWealsoneedtoacknowledgethatitwillvarybyareaandbypropertytypeLetrsquoslookatMoseleyasanexampleWewilllookatjustoneandtwobedroomflatsinMoseley
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
13
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
LetrsquosfirstlookattheaskingpricesAtaglancetheaverageaskingpricetodayofaonebedroomflatinMoseleyispound90000Incontrasttheaverageaskingpriceforatwobedispound133000SowhatabouttherentsWellbasedonwhatisadvertisedtodayonZooplaatypicalonebedroomflatisadvertisedwitharentalpriceofpound500percalendarmonthandatwobedatpound610permonthTranslatethisintoyieldsandthatrsquosayieldof66fortheonebedagainst55forthetwobedSopurelyintermsofachievableyieldstheonebedisthebetteroptionButwhataboutcapitalappreciationWellthisiswhereitgetsabitmoredifficultNormallyifIwasgoingtopredictpotentialforcapitalappreciationIwouldlooktopreviousyearsrsquogrowthasanindicatorHoweverthepastdecadehasbeenaturbulenttimeforpropertyownersandnomoresothanforthosewhoboughtflatsinMoseleyArapidincreaseinthebuildingofnewflatscoupledwiththenationwideeconomicproblemsresultedinvaluesstagnatingoreveninnegativegrowthforsomeThankfullythingsseemtohavesettledsomewhatandifyouwerebuyingaflatnowyoucoulddosowithalotmoreconfidenceAstwobedsappealbothtohomeownersandbuytoletinvestorsthesenormallyofferbothbettercapitalappreciationandareeasiertosellinthelongrunOfcourseanotheroptionwouldbetofocusinsteadonhouseswhichhavecontinuedtoappreciate
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
14
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ShouldyoubeworryingaboutBrexitUnlessyoursquovebeenlivinginacavetheselastcoupleofweeksyoursquollhavestruggledtoescapethetorrentofdiscussionsconjecturesandanalysisinthemediaofthesocalledBrexitWhetheritisrightorwrongremainstobeseenandsurelywewillonlytrulybeabletojudgewiththebenefitofhindsighthoweveronethingwhichseemstohavebeenmissedbythemainstreammediaisthepotentialimpactontheUKpropertymarketNowyoumightsaythatthereasonthishasnrsquotbeendiscussedisbecausetheeffectislargelyunknownbutIwouldsaythatthisisnotthereasonAfterallwhodoesreallyknowatthisstagetheimpactofanimpendingdivorcefromtheEUonanyspecificaspectoftheUKeconomyEventhefutureoftheNHSwhichwasamajorpointoffocusduringthepre-referendumcampaigningseemstobeinquestionSowhyhastheimpactontheUKpropertymarketnotbeensowidelydiscussedintheensuingweekssincethereferendumMyopinionisthisndashpropertyinvestorsfallintooneoftwocampsSeriousinvestorswhohaveclearlydefinedobjectivesfortheirpropertybusinessesThesepeoplehavenrsquotgotintopropertyonawhimInsteadtheyhavethoughtaboutitplannedforitandindeedtheyhaveputinplacecongruentstrategieswhichhelpthemmeettheirobjectivesSuretheymaynowbeconcernedaboutwhatmaychangeintheensuingmonthsandyearsbuttheywilllargelyadaptanddevelopnewtacticswhichwillallowthemtonotonlywhetheranstormbutalsotakeadvantageoftheprevailingconditionsSowhyisthisgroupnottalkingaboutBrexitSimplebecausetheyarebusydoinghellipbusythinkingplanningreviewingandadapting
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
15
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
thesepeoplenottalkingaboutBrexitBecauseiftheydidnrsquothaveaplanpre-referendumtheymostlikelydonrsquothaveonenowTobeblunttheyrsquorestickingtheirheadinthesandNowincaseyouthinkIrsquombeingoverlyharshtothissecondgroupletrsquosbeclearndashIhavemassivesympathyforaccidentallandlordsManyofmyclientsfallintothisgroupandtheyarenotinthispositionbecausetheychosetobeMaybetheyboughtatthepeakofthemarketandfoundthemselvesbeingunabletomovewhentheirfamilygrewOthersnodoubtownedhomespriortomeetinggirlfriendsboyfriendshusbandsandwivesOvertheyearstheadvicehasoftenbeengiventhatifyoucanrsquotselljustrentNeverthelessmypointremainsthattheydidnotactivelychoosetobeinthispositionSowhatwillhappentotheUKpropertymarketAtthetimeofwritingIamseparatedfrommycrystalball[IlentittoaWelshfootiefanandnevergotitback]soIwillrefrainfrommakingwildpredictionsHoweverIwillstatethefollowinghellipIrrespectiveofwhathappenspostreferendumthefollowingremainsunalteredhellipdemandandsupplyofhousingYesmortgageratesmaychangeandmortgagesmaybecomemoreorlessaccessiblendashindeedwemayallfeellikewehavemoreorlessmoneyinourpocketndashbutultimatelyweallstillneedsomewheretoliveInconclusionIthinkthechoiceyouhaveasapropertyinvestoriswhetheryouallowexternaleventstodictateyouractionsorwhetheryougrabthebullbythehornsandcreateyourownoutcomeIdonrsquotknowaboutyoubutIknowwhichoneIprefer
ThesecondgrouparetheaccidentallandlordsThesepeoplearenrsquotreallyinvestorsatallThisisthegroupwhoifthewindchangeswillmostsurelyfeeltheeffectsmostkeenlyWhyare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
16
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
MortgagesByMatthewJonesofMoneywatchFinance01217453347AlltoooftenpeopledecidetobuyapropertywithoutconsideringtheimportanceofgettingtheirfinancialduckslinedupWehavehadinstancesinthepastwherepeoplehavespentmanymonthssearchingfortheidealbuytoletpropertyonlyforeverythingtofallapartbecausetheyhadnrsquotdonethebasicsIwouldencourageanyinvestorlookingtobuytolettotakeacarefullookattheirowncreditreportsomethingthebankswilluseinthedecisionmakingprocessoftenmakingitthefirstthingtheycheckviaanautomatedprocessldquocomputersaysnordquoThethreecreditbureausintheUKarecurrentlyExperianEquifaxandCallCreditThefirsttwowillallowyouaccesstoyourcreditreportforthefirst28daysforfreebutwhatmanypeopledonotknowisthatCallCreditallowsyouaccesstoyourrecordsfreeofchargeforlifeviathewebsitewwwnoddlecoukWehavehelpedmanyinvestorsoverthepastfewyearsimprovetheircreditscoreHereareafewsimpleyeteffectivetipsUseyourcreditcardandclearitinfulleverymonthtohelpbuildyourcreditscoreDonrsquotuseyouroverdraftLendersnowtreatoverdraftsthesameastheywouldpaydaylendingBettertohavepound1000inyourcurrentaccountconstantlyandpound1000lessinyoursavingsaccountsMakesureyouareontheelectoralroll-againwehaveseeninvestorswithlargedepositsanddecentincomesfailthelendersinitialchecksbecausetheywerenrsquotontheelectoralrollFinallydonrsquotassumebuytoletlenderswonrsquotbeinterestedinyourincomeThingshavechangedandthemarketisalottighternowadayswithalotmore
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
17
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ReferencingThesadfactisthatevengoodtenantscanturnbadsonoamountofreferencingorcreditcheckswillcompletelyeliminateyourrisksHoweverwithacombinationofthoroughreferencingcreditchecksandtoppingitalloffwitharentguaranteeyoucertainlycanminimiseyourexposuretofinanciallossWhilstnotimpossibleitcanbedifficultforlandlordstodoacreditcheckonpotentialtenantsThisiswhymanylandlordspreferthistobedonebyalettingagentHoweverasabareminimumIwouldsuggestthatanylandlordshouldcheckthefollowing
Checkthatyourpotentialtenantcancomfortablyaffordtherent(30xmonthlyrentasanannualincomeisagoodguide)CheckwiththelandlordhowtheirprevioustenancywasconductedCheckthatpotentialtenantshavethelegalrighttoresideandrentintheUK(seenextsection)
FinallyandthisissomethingwhichmostagentswontsaytoyoubutIwillasIamalsoalandlordsoIwill-useyourgutinstinct
ImnotsayingyoucanrelyonyourgutinstincttospotagoodtenantbutifyourgutinstincttellsyouthatapotentialtenantwillbeproblematicthenyoureprobablycorrectAlotofthisboilsdowntoexperiencebutsuchthingswhichsometimesringalarmbellswithmeinclude
BeingabsolutelydesparatetomoveinOfferingtopayalargerdepositoreventhefullrentupfrontfornoapparentreasonBeingunabletoprovidefullreferencesViewingonbehalfofsomeoneelsewhoyouareunabletomeetuntilthemovein
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
18
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
19
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
20
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
21
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
22
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
9
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
RiskvsRewardWithpricesinBirminghamontheriseitrsquosunsurprisingthatmanypropertyinvestorsarestartingtolooktothesurroundingareasforcheaperpropertiesFormosttherootoftheproblemisthelargeamountofdepositrequiredbythemajorityofbuytoletlendersNowthethingisthisndash
wherevertheybuyinvestorsstillwanttoachievegoodyieldsandcapitalgrowthButasweknowifoneareaischeaperthananotheritisprobablybecauseitisnotseenasbeingasdesirableAtextremesthismaymeanthatthecalibreoftenantisnotthesameandwiththiscomesassociatedrisksThisbringsmenicelyontothesubjectofriskversusrewardYouseeyourarelygetsomethingfornothingEitheryougoforanicesafebet(sayatraditionalterracejustofftheKingsHeathhighstreet)withanaverage4yieldoryougoforsomethingmoreriskylikeaflatinanex-councilblockwitha7-10yieldNowmostlandlordsarenotsnobsafterallformostitissimplyabusinessandtheyhavelittleornoemotionalattachmenttothepropertyitselfsothethingtobearinmindwhenoptingforahigherriskstrategyistheeaseofmanagement
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
10
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhereasthemanagementofapropertyinaprimelocationmaybefairlystraightforwardandeasilytackledbythelandlordthemselvesyoumightwellcomeupagainstsomehurdleswhenlookingafterapropertyinahigherriskareaForexampleyoumayfindyourselfhavingtodealwithhousingbenefitclaimsYoumayalsohavetoacceptthatyourtenanthasmultiplesourcesofincomewhichmaymeanthattheircashflowandconsequentlyyourcashflowarenotassmoothasyoursquodbothlikeInadditionyoumaywellfindthatyourpropertysuffersmorewithwearandtearaslowerincometenantsaremorelikelytobefamiliesthancouplesorsinglepeopleThereisnorightorwronginthisitissimplyacaseofwhatyou(andifyoursquoreusingoneyourlettingagent)feelcomfortablewith
ChooseyouragentcarefullyIrsquodliketotellyouaboutsomethingwhichhappenedearlierthisweekandwhichquitefranklyastoundedmeAlandlordwhoIhaveknownforthebestpartofsixyearsbuthavenrsquotseenforaboutninemonths(youngbabyputhimoutofactionforabit)toldmeabouttheproblemshehadbeenhavingwithhislettingagentNowIrsquodjustliketosaybeforeIgoanyfurtherthatthisisnrsquotaboutanyofthelocalagentsinourareainfacttheagentconcernedisnrsquoteveninSouthBirminghamhoweverIthinkthisisapertinentlessonforanylandlordespeciallythosewithanumberofpropertieswhichtheyentrusttoasingleagentBasicallywhathadhappenedwasthatthelandlordrsquoslettingagent(whomanagedintheregionof50or60propertiesforhim)hadnotbeenpayinghimthefullrentThiswasnrsquotbecausemaintenancehadbeendoneatthepropertiesandthereforedeductedfromtherentitwassimplythecasethatthisdishonestagentassumedthatbecausethelandlordhadsomanypropertieshewouldnrsquotnoticeafewquidmissinghereorthere
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
11
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhilstIrsquodliketothinkthatiftheyweremypropertiesIwouldnoticeashortfallIcanrsquothonestlysaythatIwouldbeabletotellifIhad50ormorepropertieswithvariousrentscominginatdifferenttimesduringthemonthThelessonhereisthatanydecentagentshouldbeprovidingasamatterofcoursemonthlyemailedstatementsWhetheritrsquosforalandlordwithasinglepropertyinwhichcaseitissimplyabreakdownofrentreceivedminusfeesandmaintenanceagainstrentremittedorforalandlordwithaportfolioofpropertiesasummaryplustheindividualstatementsThankfullythelandlordinquestiongothismoneybackbutitmightnothavebeensuchahappyendingifthesituationhadgoneonforlongerandtheamountofrentindeficithadbeenhigherIndeedhadthelettingagentnotbeensolventthisisasituationwhichmayneverhavebeenputrightAndthisgotmethinkingHowmanylandlordsoutthereareunhappywiththeirlettingagentbutratherthanvotingwiththeirfeetandtakingtheirbusinesselsewhereareinsteadjustputtingupandshuttingupIfthingsarenrsquotrightwhywouldnrsquotyouchangeWhatrsquosstoppingyoufrommovingyourpropertiestoanagentwhoappreciatesyourbusinessIsitbecauseyoubelievethatmovingtoanotheragentmidtenancyissimplytoodifficulttooriskyormaybesimplythatyoudonrsquotknowhowitrsquosdoneIntruthitrsquosnotthatdifficultyoujustneedthenervetodoit
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
12
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhatrsquostheidealnumberofbedroomsOneofthequestionsIamoftenaskedbynewinvestorsiswhatistheidealnumberofbedroomsforarentalpropertyTheanswerinpartdependsonwhetheryouaretalkingabouthousesorflatsItalsodependsonwhatyourinvestmentstrategyisByinvestmentstrategyImeanwhetheryouaretryingtomaximisetheyieldforshorttermcash-floworgoingforapropertywithpotentialforgoodcapitalappreciationinthelongertermOfcourseyoumaywellbeaimingforacombinationofthetwoToanswerthequestionofhowmanybedroomsisbetterforbuytoletweneedtounderstandtheeffectthishasonboththeyieldandthecapitalappreciationWealsoneedtoacknowledgethatitwillvarybyareaandbypropertytypeLetrsquoslookatMoseleyasanexampleWewilllookatjustoneandtwobedroomflatsinMoseley
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
13
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
LetrsquosfirstlookattheaskingpricesAtaglancetheaverageaskingpricetodayofaonebedroomflatinMoseleyispound90000Incontrasttheaverageaskingpriceforatwobedispound133000SowhatabouttherentsWellbasedonwhatisadvertisedtodayonZooplaatypicalonebedroomflatisadvertisedwitharentalpriceofpound500percalendarmonthandatwobedatpound610permonthTranslatethisintoyieldsandthatrsquosayieldof66fortheonebedagainst55forthetwobedSopurelyintermsofachievableyieldstheonebedisthebetteroptionButwhataboutcapitalappreciationWellthisiswhereitgetsabitmoredifficultNormallyifIwasgoingtopredictpotentialforcapitalappreciationIwouldlooktopreviousyearsrsquogrowthasanindicatorHoweverthepastdecadehasbeenaturbulenttimeforpropertyownersandnomoresothanforthosewhoboughtflatsinMoseleyArapidincreaseinthebuildingofnewflatscoupledwiththenationwideeconomicproblemsresultedinvaluesstagnatingoreveninnegativegrowthforsomeThankfullythingsseemtohavesettledsomewhatandifyouwerebuyingaflatnowyoucoulddosowithalotmoreconfidenceAstwobedsappealbothtohomeownersandbuytoletinvestorsthesenormallyofferbothbettercapitalappreciationandareeasiertosellinthelongrunOfcourseanotheroptionwouldbetofocusinsteadonhouseswhichhavecontinuedtoappreciate
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
14
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ShouldyoubeworryingaboutBrexitUnlessyoursquovebeenlivinginacavetheselastcoupleofweeksyoursquollhavestruggledtoescapethetorrentofdiscussionsconjecturesandanalysisinthemediaofthesocalledBrexitWhetheritisrightorwrongremainstobeseenandsurelywewillonlytrulybeabletojudgewiththebenefitofhindsighthoweveronethingwhichseemstohavebeenmissedbythemainstreammediaisthepotentialimpactontheUKpropertymarketNowyoumightsaythatthereasonthishasnrsquotbeendiscussedisbecausetheeffectislargelyunknownbutIwouldsaythatthisisnotthereasonAfterallwhodoesreallyknowatthisstagetheimpactofanimpendingdivorcefromtheEUonanyspecificaspectoftheUKeconomyEventhefutureoftheNHSwhichwasamajorpointoffocusduringthepre-referendumcampaigningseemstobeinquestionSowhyhastheimpactontheUKpropertymarketnotbeensowidelydiscussedintheensuingweekssincethereferendumMyopinionisthisndashpropertyinvestorsfallintooneoftwocampsSeriousinvestorswhohaveclearlydefinedobjectivesfortheirpropertybusinessesThesepeoplehavenrsquotgotintopropertyonawhimInsteadtheyhavethoughtaboutitplannedforitandindeedtheyhaveputinplacecongruentstrategieswhichhelpthemmeettheirobjectivesSuretheymaynowbeconcernedaboutwhatmaychangeintheensuingmonthsandyearsbuttheywilllargelyadaptanddevelopnewtacticswhichwillallowthemtonotonlywhetheranstormbutalsotakeadvantageoftheprevailingconditionsSowhyisthisgroupnottalkingaboutBrexitSimplebecausetheyarebusydoinghellipbusythinkingplanningreviewingandadapting
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
15
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
thesepeoplenottalkingaboutBrexitBecauseiftheydidnrsquothaveaplanpre-referendumtheymostlikelydonrsquothaveonenowTobeblunttheyrsquorestickingtheirheadinthesandNowincaseyouthinkIrsquombeingoverlyharshtothissecondgroupletrsquosbeclearndashIhavemassivesympathyforaccidentallandlordsManyofmyclientsfallintothisgroupandtheyarenotinthispositionbecausetheychosetobeMaybetheyboughtatthepeakofthemarketandfoundthemselvesbeingunabletomovewhentheirfamilygrewOthersnodoubtownedhomespriortomeetinggirlfriendsboyfriendshusbandsandwivesOvertheyearstheadvicehasoftenbeengiventhatifyoucanrsquotselljustrentNeverthelessmypointremainsthattheydidnotactivelychoosetobeinthispositionSowhatwillhappentotheUKpropertymarketAtthetimeofwritingIamseparatedfrommycrystalball[IlentittoaWelshfootiefanandnevergotitback]soIwillrefrainfrommakingwildpredictionsHoweverIwillstatethefollowinghellipIrrespectiveofwhathappenspostreferendumthefollowingremainsunalteredhellipdemandandsupplyofhousingYesmortgageratesmaychangeandmortgagesmaybecomemoreorlessaccessiblendashindeedwemayallfeellikewehavemoreorlessmoneyinourpocketndashbutultimatelyweallstillneedsomewheretoliveInconclusionIthinkthechoiceyouhaveasapropertyinvestoriswhetheryouallowexternaleventstodictateyouractionsorwhetheryougrabthebullbythehornsandcreateyourownoutcomeIdonrsquotknowaboutyoubutIknowwhichoneIprefer
ThesecondgrouparetheaccidentallandlordsThesepeoplearenrsquotreallyinvestorsatallThisisthegroupwhoifthewindchangeswillmostsurelyfeeltheeffectsmostkeenlyWhyare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
16
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
MortgagesByMatthewJonesofMoneywatchFinance01217453347AlltoooftenpeopledecidetobuyapropertywithoutconsideringtheimportanceofgettingtheirfinancialduckslinedupWehavehadinstancesinthepastwherepeoplehavespentmanymonthssearchingfortheidealbuytoletpropertyonlyforeverythingtofallapartbecausetheyhadnrsquotdonethebasicsIwouldencourageanyinvestorlookingtobuytolettotakeacarefullookattheirowncreditreportsomethingthebankswilluseinthedecisionmakingprocessoftenmakingitthefirstthingtheycheckviaanautomatedprocessldquocomputersaysnordquoThethreecreditbureausintheUKarecurrentlyExperianEquifaxandCallCreditThefirsttwowillallowyouaccesstoyourcreditreportforthefirst28daysforfreebutwhatmanypeopledonotknowisthatCallCreditallowsyouaccesstoyourrecordsfreeofchargeforlifeviathewebsitewwwnoddlecoukWehavehelpedmanyinvestorsoverthepastfewyearsimprovetheircreditscoreHereareafewsimpleyeteffectivetipsUseyourcreditcardandclearitinfulleverymonthtohelpbuildyourcreditscoreDonrsquotuseyouroverdraftLendersnowtreatoverdraftsthesameastheywouldpaydaylendingBettertohavepound1000inyourcurrentaccountconstantlyandpound1000lessinyoursavingsaccountsMakesureyouareontheelectoralroll-againwehaveseeninvestorswithlargedepositsanddecentincomesfailthelendersinitialchecksbecausetheywerenrsquotontheelectoralrollFinallydonrsquotassumebuytoletlenderswonrsquotbeinterestedinyourincomeThingshavechangedandthemarketisalottighternowadayswithalotmore
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
17
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ReferencingThesadfactisthatevengoodtenantscanturnbadsonoamountofreferencingorcreditcheckswillcompletelyeliminateyourrisksHoweverwithacombinationofthoroughreferencingcreditchecksandtoppingitalloffwitharentguaranteeyoucertainlycanminimiseyourexposuretofinanciallossWhilstnotimpossibleitcanbedifficultforlandlordstodoacreditcheckonpotentialtenantsThisiswhymanylandlordspreferthistobedonebyalettingagentHoweverasabareminimumIwouldsuggestthatanylandlordshouldcheckthefollowing
Checkthatyourpotentialtenantcancomfortablyaffordtherent(30xmonthlyrentasanannualincomeisagoodguide)CheckwiththelandlordhowtheirprevioustenancywasconductedCheckthatpotentialtenantshavethelegalrighttoresideandrentintheUK(seenextsection)
FinallyandthisissomethingwhichmostagentswontsaytoyoubutIwillasIamalsoalandlordsoIwill-useyourgutinstinct
ImnotsayingyoucanrelyonyourgutinstincttospotagoodtenantbutifyourgutinstincttellsyouthatapotentialtenantwillbeproblematicthenyoureprobablycorrectAlotofthisboilsdowntoexperiencebutsuchthingswhichsometimesringalarmbellswithmeinclude
BeingabsolutelydesparatetomoveinOfferingtopayalargerdepositoreventhefullrentupfrontfornoapparentreasonBeingunabletoprovidefullreferencesViewingonbehalfofsomeoneelsewhoyouareunabletomeetuntilthemovein
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
18
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
19
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
20
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
21
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
22
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
10
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhereasthemanagementofapropertyinaprimelocationmaybefairlystraightforwardandeasilytackledbythelandlordthemselvesyoumightwellcomeupagainstsomehurdleswhenlookingafterapropertyinahigherriskareaForexampleyoumayfindyourselfhavingtodealwithhousingbenefitclaimsYoumayalsohavetoacceptthatyourtenanthasmultiplesourcesofincomewhichmaymeanthattheircashflowandconsequentlyyourcashflowarenotassmoothasyoursquodbothlikeInadditionyoumaywellfindthatyourpropertysuffersmorewithwearandtearaslowerincometenantsaremorelikelytobefamiliesthancouplesorsinglepeopleThereisnorightorwronginthisitissimplyacaseofwhatyou(andifyoursquoreusingoneyourlettingagent)feelcomfortablewith
ChooseyouragentcarefullyIrsquodliketotellyouaboutsomethingwhichhappenedearlierthisweekandwhichquitefranklyastoundedmeAlandlordwhoIhaveknownforthebestpartofsixyearsbuthavenrsquotseenforaboutninemonths(youngbabyputhimoutofactionforabit)toldmeabouttheproblemshehadbeenhavingwithhislettingagentNowIrsquodjustliketosaybeforeIgoanyfurtherthatthisisnrsquotaboutanyofthelocalagentsinourareainfacttheagentconcernedisnrsquoteveninSouthBirminghamhoweverIthinkthisisapertinentlessonforanylandlordespeciallythosewithanumberofpropertieswhichtheyentrusttoasingleagentBasicallywhathadhappenedwasthatthelandlordrsquoslettingagent(whomanagedintheregionof50or60propertiesforhim)hadnotbeenpayinghimthefullrentThiswasnrsquotbecausemaintenancehadbeendoneatthepropertiesandthereforedeductedfromtherentitwassimplythecasethatthisdishonestagentassumedthatbecausethelandlordhadsomanypropertieshewouldnrsquotnoticeafewquidmissinghereorthere
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
11
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhilstIrsquodliketothinkthatiftheyweremypropertiesIwouldnoticeashortfallIcanrsquothonestlysaythatIwouldbeabletotellifIhad50ormorepropertieswithvariousrentscominginatdifferenttimesduringthemonthThelessonhereisthatanydecentagentshouldbeprovidingasamatterofcoursemonthlyemailedstatementsWhetheritrsquosforalandlordwithasinglepropertyinwhichcaseitissimplyabreakdownofrentreceivedminusfeesandmaintenanceagainstrentremittedorforalandlordwithaportfolioofpropertiesasummaryplustheindividualstatementsThankfullythelandlordinquestiongothismoneybackbutitmightnothavebeensuchahappyendingifthesituationhadgoneonforlongerandtheamountofrentindeficithadbeenhigherIndeedhadthelettingagentnotbeensolventthisisasituationwhichmayneverhavebeenputrightAndthisgotmethinkingHowmanylandlordsoutthereareunhappywiththeirlettingagentbutratherthanvotingwiththeirfeetandtakingtheirbusinesselsewhereareinsteadjustputtingupandshuttingupIfthingsarenrsquotrightwhywouldnrsquotyouchangeWhatrsquosstoppingyoufrommovingyourpropertiestoanagentwhoappreciatesyourbusinessIsitbecauseyoubelievethatmovingtoanotheragentmidtenancyissimplytoodifficulttooriskyormaybesimplythatyoudonrsquotknowhowitrsquosdoneIntruthitrsquosnotthatdifficultyoujustneedthenervetodoit
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
12
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhatrsquostheidealnumberofbedroomsOneofthequestionsIamoftenaskedbynewinvestorsiswhatistheidealnumberofbedroomsforarentalpropertyTheanswerinpartdependsonwhetheryouaretalkingabouthousesorflatsItalsodependsonwhatyourinvestmentstrategyisByinvestmentstrategyImeanwhetheryouaretryingtomaximisetheyieldforshorttermcash-floworgoingforapropertywithpotentialforgoodcapitalappreciationinthelongertermOfcourseyoumaywellbeaimingforacombinationofthetwoToanswerthequestionofhowmanybedroomsisbetterforbuytoletweneedtounderstandtheeffectthishasonboththeyieldandthecapitalappreciationWealsoneedtoacknowledgethatitwillvarybyareaandbypropertytypeLetrsquoslookatMoseleyasanexampleWewilllookatjustoneandtwobedroomflatsinMoseley
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
13
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
LetrsquosfirstlookattheaskingpricesAtaglancetheaverageaskingpricetodayofaonebedroomflatinMoseleyispound90000Incontrasttheaverageaskingpriceforatwobedispound133000SowhatabouttherentsWellbasedonwhatisadvertisedtodayonZooplaatypicalonebedroomflatisadvertisedwitharentalpriceofpound500percalendarmonthandatwobedatpound610permonthTranslatethisintoyieldsandthatrsquosayieldof66fortheonebedagainst55forthetwobedSopurelyintermsofachievableyieldstheonebedisthebetteroptionButwhataboutcapitalappreciationWellthisiswhereitgetsabitmoredifficultNormallyifIwasgoingtopredictpotentialforcapitalappreciationIwouldlooktopreviousyearsrsquogrowthasanindicatorHoweverthepastdecadehasbeenaturbulenttimeforpropertyownersandnomoresothanforthosewhoboughtflatsinMoseleyArapidincreaseinthebuildingofnewflatscoupledwiththenationwideeconomicproblemsresultedinvaluesstagnatingoreveninnegativegrowthforsomeThankfullythingsseemtohavesettledsomewhatandifyouwerebuyingaflatnowyoucoulddosowithalotmoreconfidenceAstwobedsappealbothtohomeownersandbuytoletinvestorsthesenormallyofferbothbettercapitalappreciationandareeasiertosellinthelongrunOfcourseanotheroptionwouldbetofocusinsteadonhouseswhichhavecontinuedtoappreciate
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
14
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ShouldyoubeworryingaboutBrexitUnlessyoursquovebeenlivinginacavetheselastcoupleofweeksyoursquollhavestruggledtoescapethetorrentofdiscussionsconjecturesandanalysisinthemediaofthesocalledBrexitWhetheritisrightorwrongremainstobeseenandsurelywewillonlytrulybeabletojudgewiththebenefitofhindsighthoweveronethingwhichseemstohavebeenmissedbythemainstreammediaisthepotentialimpactontheUKpropertymarketNowyoumightsaythatthereasonthishasnrsquotbeendiscussedisbecausetheeffectislargelyunknownbutIwouldsaythatthisisnotthereasonAfterallwhodoesreallyknowatthisstagetheimpactofanimpendingdivorcefromtheEUonanyspecificaspectoftheUKeconomyEventhefutureoftheNHSwhichwasamajorpointoffocusduringthepre-referendumcampaigningseemstobeinquestionSowhyhastheimpactontheUKpropertymarketnotbeensowidelydiscussedintheensuingweekssincethereferendumMyopinionisthisndashpropertyinvestorsfallintooneoftwocampsSeriousinvestorswhohaveclearlydefinedobjectivesfortheirpropertybusinessesThesepeoplehavenrsquotgotintopropertyonawhimInsteadtheyhavethoughtaboutitplannedforitandindeedtheyhaveputinplacecongruentstrategieswhichhelpthemmeettheirobjectivesSuretheymaynowbeconcernedaboutwhatmaychangeintheensuingmonthsandyearsbuttheywilllargelyadaptanddevelopnewtacticswhichwillallowthemtonotonlywhetheranstormbutalsotakeadvantageoftheprevailingconditionsSowhyisthisgroupnottalkingaboutBrexitSimplebecausetheyarebusydoinghellipbusythinkingplanningreviewingandadapting
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
thesepeoplenottalkingaboutBrexitBecauseiftheydidnrsquothaveaplanpre-referendumtheymostlikelydonrsquothaveonenowTobeblunttheyrsquorestickingtheirheadinthesandNowincaseyouthinkIrsquombeingoverlyharshtothissecondgroupletrsquosbeclearndashIhavemassivesympathyforaccidentallandlordsManyofmyclientsfallintothisgroupandtheyarenotinthispositionbecausetheychosetobeMaybetheyboughtatthepeakofthemarketandfoundthemselvesbeingunabletomovewhentheirfamilygrewOthersnodoubtownedhomespriortomeetinggirlfriendsboyfriendshusbandsandwivesOvertheyearstheadvicehasoftenbeengiventhatifyoucanrsquotselljustrentNeverthelessmypointremainsthattheydidnotactivelychoosetobeinthispositionSowhatwillhappentotheUKpropertymarketAtthetimeofwritingIamseparatedfrommycrystalball[IlentittoaWelshfootiefanandnevergotitback]soIwillrefrainfrommakingwildpredictionsHoweverIwillstatethefollowinghellipIrrespectiveofwhathappenspostreferendumthefollowingremainsunalteredhellipdemandandsupplyofhousingYesmortgageratesmaychangeandmortgagesmaybecomemoreorlessaccessiblendashindeedwemayallfeellikewehavemoreorlessmoneyinourpocketndashbutultimatelyweallstillneedsomewheretoliveInconclusionIthinkthechoiceyouhaveasapropertyinvestoriswhetheryouallowexternaleventstodictateyouractionsorwhetheryougrabthebullbythehornsandcreateyourownoutcomeIdonrsquotknowaboutyoubutIknowwhichoneIprefer
ThesecondgrouparetheaccidentallandlordsThesepeoplearenrsquotreallyinvestorsatallThisisthegroupwhoifthewindchangeswillmostsurelyfeeltheeffectsmostkeenlyWhyare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
16
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
MortgagesByMatthewJonesofMoneywatchFinance01217453347AlltoooftenpeopledecidetobuyapropertywithoutconsideringtheimportanceofgettingtheirfinancialduckslinedupWehavehadinstancesinthepastwherepeoplehavespentmanymonthssearchingfortheidealbuytoletpropertyonlyforeverythingtofallapartbecausetheyhadnrsquotdonethebasicsIwouldencourageanyinvestorlookingtobuytolettotakeacarefullookattheirowncreditreportsomethingthebankswilluseinthedecisionmakingprocessoftenmakingitthefirstthingtheycheckviaanautomatedprocessldquocomputersaysnordquoThethreecreditbureausintheUKarecurrentlyExperianEquifaxandCallCreditThefirsttwowillallowyouaccesstoyourcreditreportforthefirst28daysforfreebutwhatmanypeopledonotknowisthatCallCreditallowsyouaccesstoyourrecordsfreeofchargeforlifeviathewebsitewwwnoddlecoukWehavehelpedmanyinvestorsoverthepastfewyearsimprovetheircreditscoreHereareafewsimpleyeteffectivetipsUseyourcreditcardandclearitinfulleverymonthtohelpbuildyourcreditscoreDonrsquotuseyouroverdraftLendersnowtreatoverdraftsthesameastheywouldpaydaylendingBettertohavepound1000inyourcurrentaccountconstantlyandpound1000lessinyoursavingsaccountsMakesureyouareontheelectoralroll-againwehaveseeninvestorswithlargedepositsanddecentincomesfailthelendersinitialchecksbecausetheywerenrsquotontheelectoralrollFinallydonrsquotassumebuytoletlenderswonrsquotbeinterestedinyourincomeThingshavechangedandthemarketisalottighternowadayswithalotmore
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
17
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ReferencingThesadfactisthatevengoodtenantscanturnbadsonoamountofreferencingorcreditcheckswillcompletelyeliminateyourrisksHoweverwithacombinationofthoroughreferencingcreditchecksandtoppingitalloffwitharentguaranteeyoucertainlycanminimiseyourexposuretofinanciallossWhilstnotimpossibleitcanbedifficultforlandlordstodoacreditcheckonpotentialtenantsThisiswhymanylandlordspreferthistobedonebyalettingagentHoweverasabareminimumIwouldsuggestthatanylandlordshouldcheckthefollowing
Checkthatyourpotentialtenantcancomfortablyaffordtherent(30xmonthlyrentasanannualincomeisagoodguide)CheckwiththelandlordhowtheirprevioustenancywasconductedCheckthatpotentialtenantshavethelegalrighttoresideandrentintheUK(seenextsection)
FinallyandthisissomethingwhichmostagentswontsaytoyoubutIwillasIamalsoalandlordsoIwill-useyourgutinstinct
ImnotsayingyoucanrelyonyourgutinstincttospotagoodtenantbutifyourgutinstincttellsyouthatapotentialtenantwillbeproblematicthenyoureprobablycorrectAlotofthisboilsdowntoexperiencebutsuchthingswhichsometimesringalarmbellswithmeinclude
BeingabsolutelydesparatetomoveinOfferingtopayalargerdepositoreventhefullrentupfrontfornoapparentreasonBeingunabletoprovidefullreferencesViewingonbehalfofsomeoneelsewhoyouareunabletomeetuntilthemovein
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
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ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
11
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhilstIrsquodliketothinkthatiftheyweremypropertiesIwouldnoticeashortfallIcanrsquothonestlysaythatIwouldbeabletotellifIhad50ormorepropertieswithvariousrentscominginatdifferenttimesduringthemonthThelessonhereisthatanydecentagentshouldbeprovidingasamatterofcoursemonthlyemailedstatementsWhetheritrsquosforalandlordwithasinglepropertyinwhichcaseitissimplyabreakdownofrentreceivedminusfeesandmaintenanceagainstrentremittedorforalandlordwithaportfolioofpropertiesasummaryplustheindividualstatementsThankfullythelandlordinquestiongothismoneybackbutitmightnothavebeensuchahappyendingifthesituationhadgoneonforlongerandtheamountofrentindeficithadbeenhigherIndeedhadthelettingagentnotbeensolventthisisasituationwhichmayneverhavebeenputrightAndthisgotmethinkingHowmanylandlordsoutthereareunhappywiththeirlettingagentbutratherthanvotingwiththeirfeetandtakingtheirbusinesselsewhereareinsteadjustputtingupandshuttingupIfthingsarenrsquotrightwhywouldnrsquotyouchangeWhatrsquosstoppingyoufrommovingyourpropertiestoanagentwhoappreciatesyourbusinessIsitbecauseyoubelievethatmovingtoanotheragentmidtenancyissimplytoodifficulttooriskyormaybesimplythatyoudonrsquotknowhowitrsquosdoneIntruthitrsquosnotthatdifficultyoujustneedthenervetodoit
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
12
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhatrsquostheidealnumberofbedroomsOneofthequestionsIamoftenaskedbynewinvestorsiswhatistheidealnumberofbedroomsforarentalpropertyTheanswerinpartdependsonwhetheryouaretalkingabouthousesorflatsItalsodependsonwhatyourinvestmentstrategyisByinvestmentstrategyImeanwhetheryouaretryingtomaximisetheyieldforshorttermcash-floworgoingforapropertywithpotentialforgoodcapitalappreciationinthelongertermOfcourseyoumaywellbeaimingforacombinationofthetwoToanswerthequestionofhowmanybedroomsisbetterforbuytoletweneedtounderstandtheeffectthishasonboththeyieldandthecapitalappreciationWealsoneedtoacknowledgethatitwillvarybyareaandbypropertytypeLetrsquoslookatMoseleyasanexampleWewilllookatjustoneandtwobedroomflatsinMoseley
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
13
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
LetrsquosfirstlookattheaskingpricesAtaglancetheaverageaskingpricetodayofaonebedroomflatinMoseleyispound90000Incontrasttheaverageaskingpriceforatwobedispound133000SowhatabouttherentsWellbasedonwhatisadvertisedtodayonZooplaatypicalonebedroomflatisadvertisedwitharentalpriceofpound500percalendarmonthandatwobedatpound610permonthTranslatethisintoyieldsandthatrsquosayieldof66fortheonebedagainst55forthetwobedSopurelyintermsofachievableyieldstheonebedisthebetteroptionButwhataboutcapitalappreciationWellthisiswhereitgetsabitmoredifficultNormallyifIwasgoingtopredictpotentialforcapitalappreciationIwouldlooktopreviousyearsrsquogrowthasanindicatorHoweverthepastdecadehasbeenaturbulenttimeforpropertyownersandnomoresothanforthosewhoboughtflatsinMoseleyArapidincreaseinthebuildingofnewflatscoupledwiththenationwideeconomicproblemsresultedinvaluesstagnatingoreveninnegativegrowthforsomeThankfullythingsseemtohavesettledsomewhatandifyouwerebuyingaflatnowyoucoulddosowithalotmoreconfidenceAstwobedsappealbothtohomeownersandbuytoletinvestorsthesenormallyofferbothbettercapitalappreciationandareeasiertosellinthelongrunOfcourseanotheroptionwouldbetofocusinsteadonhouseswhichhavecontinuedtoappreciate
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
14
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ShouldyoubeworryingaboutBrexitUnlessyoursquovebeenlivinginacavetheselastcoupleofweeksyoursquollhavestruggledtoescapethetorrentofdiscussionsconjecturesandanalysisinthemediaofthesocalledBrexitWhetheritisrightorwrongremainstobeseenandsurelywewillonlytrulybeabletojudgewiththebenefitofhindsighthoweveronethingwhichseemstohavebeenmissedbythemainstreammediaisthepotentialimpactontheUKpropertymarketNowyoumightsaythatthereasonthishasnrsquotbeendiscussedisbecausetheeffectislargelyunknownbutIwouldsaythatthisisnotthereasonAfterallwhodoesreallyknowatthisstagetheimpactofanimpendingdivorcefromtheEUonanyspecificaspectoftheUKeconomyEventhefutureoftheNHSwhichwasamajorpointoffocusduringthepre-referendumcampaigningseemstobeinquestionSowhyhastheimpactontheUKpropertymarketnotbeensowidelydiscussedintheensuingweekssincethereferendumMyopinionisthisndashpropertyinvestorsfallintooneoftwocampsSeriousinvestorswhohaveclearlydefinedobjectivesfortheirpropertybusinessesThesepeoplehavenrsquotgotintopropertyonawhimInsteadtheyhavethoughtaboutitplannedforitandindeedtheyhaveputinplacecongruentstrategieswhichhelpthemmeettheirobjectivesSuretheymaynowbeconcernedaboutwhatmaychangeintheensuingmonthsandyearsbuttheywilllargelyadaptanddevelopnewtacticswhichwillallowthemtonotonlywhetheranstormbutalsotakeadvantageoftheprevailingconditionsSowhyisthisgroupnottalkingaboutBrexitSimplebecausetheyarebusydoinghellipbusythinkingplanningreviewingandadapting
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
15
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
thesepeoplenottalkingaboutBrexitBecauseiftheydidnrsquothaveaplanpre-referendumtheymostlikelydonrsquothaveonenowTobeblunttheyrsquorestickingtheirheadinthesandNowincaseyouthinkIrsquombeingoverlyharshtothissecondgroupletrsquosbeclearndashIhavemassivesympathyforaccidentallandlordsManyofmyclientsfallintothisgroupandtheyarenotinthispositionbecausetheychosetobeMaybetheyboughtatthepeakofthemarketandfoundthemselvesbeingunabletomovewhentheirfamilygrewOthersnodoubtownedhomespriortomeetinggirlfriendsboyfriendshusbandsandwivesOvertheyearstheadvicehasoftenbeengiventhatifyoucanrsquotselljustrentNeverthelessmypointremainsthattheydidnotactivelychoosetobeinthispositionSowhatwillhappentotheUKpropertymarketAtthetimeofwritingIamseparatedfrommycrystalball[IlentittoaWelshfootiefanandnevergotitback]soIwillrefrainfrommakingwildpredictionsHoweverIwillstatethefollowinghellipIrrespectiveofwhathappenspostreferendumthefollowingremainsunalteredhellipdemandandsupplyofhousingYesmortgageratesmaychangeandmortgagesmaybecomemoreorlessaccessiblendashindeedwemayallfeellikewehavemoreorlessmoneyinourpocketndashbutultimatelyweallstillneedsomewheretoliveInconclusionIthinkthechoiceyouhaveasapropertyinvestoriswhetheryouallowexternaleventstodictateyouractionsorwhetheryougrabthebullbythehornsandcreateyourownoutcomeIdonrsquotknowaboutyoubutIknowwhichoneIprefer
ThesecondgrouparetheaccidentallandlordsThesepeoplearenrsquotreallyinvestorsatallThisisthegroupwhoifthewindchangeswillmostsurelyfeeltheeffectsmostkeenlyWhyare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
16
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
MortgagesByMatthewJonesofMoneywatchFinance01217453347AlltoooftenpeopledecidetobuyapropertywithoutconsideringtheimportanceofgettingtheirfinancialduckslinedupWehavehadinstancesinthepastwherepeoplehavespentmanymonthssearchingfortheidealbuytoletpropertyonlyforeverythingtofallapartbecausetheyhadnrsquotdonethebasicsIwouldencourageanyinvestorlookingtobuytolettotakeacarefullookattheirowncreditreportsomethingthebankswilluseinthedecisionmakingprocessoftenmakingitthefirstthingtheycheckviaanautomatedprocessldquocomputersaysnordquoThethreecreditbureausintheUKarecurrentlyExperianEquifaxandCallCreditThefirsttwowillallowyouaccesstoyourcreditreportforthefirst28daysforfreebutwhatmanypeopledonotknowisthatCallCreditallowsyouaccesstoyourrecordsfreeofchargeforlifeviathewebsitewwwnoddlecoukWehavehelpedmanyinvestorsoverthepastfewyearsimprovetheircreditscoreHereareafewsimpleyeteffectivetipsUseyourcreditcardandclearitinfulleverymonthtohelpbuildyourcreditscoreDonrsquotuseyouroverdraftLendersnowtreatoverdraftsthesameastheywouldpaydaylendingBettertohavepound1000inyourcurrentaccountconstantlyandpound1000lessinyoursavingsaccountsMakesureyouareontheelectoralroll-againwehaveseeninvestorswithlargedepositsanddecentincomesfailthelendersinitialchecksbecausetheywerenrsquotontheelectoralrollFinallydonrsquotassumebuytoletlenderswonrsquotbeinterestedinyourincomeThingshavechangedandthemarketisalottighternowadayswithalotmore
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
17
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ReferencingThesadfactisthatevengoodtenantscanturnbadsonoamountofreferencingorcreditcheckswillcompletelyeliminateyourrisksHoweverwithacombinationofthoroughreferencingcreditchecksandtoppingitalloffwitharentguaranteeyoucertainlycanminimiseyourexposuretofinanciallossWhilstnotimpossibleitcanbedifficultforlandlordstodoacreditcheckonpotentialtenantsThisiswhymanylandlordspreferthistobedonebyalettingagentHoweverasabareminimumIwouldsuggestthatanylandlordshouldcheckthefollowing
Checkthatyourpotentialtenantcancomfortablyaffordtherent(30xmonthlyrentasanannualincomeisagoodguide)CheckwiththelandlordhowtheirprevioustenancywasconductedCheckthatpotentialtenantshavethelegalrighttoresideandrentintheUK(seenextsection)
FinallyandthisissomethingwhichmostagentswontsaytoyoubutIwillasIamalsoalandlordsoIwill-useyourgutinstinct
ImnotsayingyoucanrelyonyourgutinstincttospotagoodtenantbutifyourgutinstincttellsyouthatapotentialtenantwillbeproblematicthenyoureprobablycorrectAlotofthisboilsdowntoexperiencebutsuchthingswhichsometimesringalarmbellswithmeinclude
BeingabsolutelydesparatetomoveinOfferingtopayalargerdepositoreventhefullrentupfrontfornoapparentreasonBeingunabletoprovidefullreferencesViewingonbehalfofsomeoneelsewhoyouareunabletomeetuntilthemovein
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
18
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
19
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
20
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
21
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
22
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
12
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
WhatrsquostheidealnumberofbedroomsOneofthequestionsIamoftenaskedbynewinvestorsiswhatistheidealnumberofbedroomsforarentalpropertyTheanswerinpartdependsonwhetheryouaretalkingabouthousesorflatsItalsodependsonwhatyourinvestmentstrategyisByinvestmentstrategyImeanwhetheryouaretryingtomaximisetheyieldforshorttermcash-floworgoingforapropertywithpotentialforgoodcapitalappreciationinthelongertermOfcourseyoumaywellbeaimingforacombinationofthetwoToanswerthequestionofhowmanybedroomsisbetterforbuytoletweneedtounderstandtheeffectthishasonboththeyieldandthecapitalappreciationWealsoneedtoacknowledgethatitwillvarybyareaandbypropertytypeLetrsquoslookatMoseleyasanexampleWewilllookatjustoneandtwobedroomflatsinMoseley
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
13
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
LetrsquosfirstlookattheaskingpricesAtaglancetheaverageaskingpricetodayofaonebedroomflatinMoseleyispound90000Incontrasttheaverageaskingpriceforatwobedispound133000SowhatabouttherentsWellbasedonwhatisadvertisedtodayonZooplaatypicalonebedroomflatisadvertisedwitharentalpriceofpound500percalendarmonthandatwobedatpound610permonthTranslatethisintoyieldsandthatrsquosayieldof66fortheonebedagainst55forthetwobedSopurelyintermsofachievableyieldstheonebedisthebetteroptionButwhataboutcapitalappreciationWellthisiswhereitgetsabitmoredifficultNormallyifIwasgoingtopredictpotentialforcapitalappreciationIwouldlooktopreviousyearsrsquogrowthasanindicatorHoweverthepastdecadehasbeenaturbulenttimeforpropertyownersandnomoresothanforthosewhoboughtflatsinMoseleyArapidincreaseinthebuildingofnewflatscoupledwiththenationwideeconomicproblemsresultedinvaluesstagnatingoreveninnegativegrowthforsomeThankfullythingsseemtohavesettledsomewhatandifyouwerebuyingaflatnowyoucoulddosowithalotmoreconfidenceAstwobedsappealbothtohomeownersandbuytoletinvestorsthesenormallyofferbothbettercapitalappreciationandareeasiertosellinthelongrunOfcourseanotheroptionwouldbetofocusinsteadonhouseswhichhavecontinuedtoappreciate
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
14
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ShouldyoubeworryingaboutBrexitUnlessyoursquovebeenlivinginacavetheselastcoupleofweeksyoursquollhavestruggledtoescapethetorrentofdiscussionsconjecturesandanalysisinthemediaofthesocalledBrexitWhetheritisrightorwrongremainstobeseenandsurelywewillonlytrulybeabletojudgewiththebenefitofhindsighthoweveronethingwhichseemstohavebeenmissedbythemainstreammediaisthepotentialimpactontheUKpropertymarketNowyoumightsaythatthereasonthishasnrsquotbeendiscussedisbecausetheeffectislargelyunknownbutIwouldsaythatthisisnotthereasonAfterallwhodoesreallyknowatthisstagetheimpactofanimpendingdivorcefromtheEUonanyspecificaspectoftheUKeconomyEventhefutureoftheNHSwhichwasamajorpointoffocusduringthepre-referendumcampaigningseemstobeinquestionSowhyhastheimpactontheUKpropertymarketnotbeensowidelydiscussedintheensuingweekssincethereferendumMyopinionisthisndashpropertyinvestorsfallintooneoftwocampsSeriousinvestorswhohaveclearlydefinedobjectivesfortheirpropertybusinessesThesepeoplehavenrsquotgotintopropertyonawhimInsteadtheyhavethoughtaboutitplannedforitandindeedtheyhaveputinplacecongruentstrategieswhichhelpthemmeettheirobjectivesSuretheymaynowbeconcernedaboutwhatmaychangeintheensuingmonthsandyearsbuttheywilllargelyadaptanddevelopnewtacticswhichwillallowthemtonotonlywhetheranstormbutalsotakeadvantageoftheprevailingconditionsSowhyisthisgroupnottalkingaboutBrexitSimplebecausetheyarebusydoinghellipbusythinkingplanningreviewingandadapting
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
15
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
thesepeoplenottalkingaboutBrexitBecauseiftheydidnrsquothaveaplanpre-referendumtheymostlikelydonrsquothaveonenowTobeblunttheyrsquorestickingtheirheadinthesandNowincaseyouthinkIrsquombeingoverlyharshtothissecondgroupletrsquosbeclearndashIhavemassivesympathyforaccidentallandlordsManyofmyclientsfallintothisgroupandtheyarenotinthispositionbecausetheychosetobeMaybetheyboughtatthepeakofthemarketandfoundthemselvesbeingunabletomovewhentheirfamilygrewOthersnodoubtownedhomespriortomeetinggirlfriendsboyfriendshusbandsandwivesOvertheyearstheadvicehasoftenbeengiventhatifyoucanrsquotselljustrentNeverthelessmypointremainsthattheydidnotactivelychoosetobeinthispositionSowhatwillhappentotheUKpropertymarketAtthetimeofwritingIamseparatedfrommycrystalball[IlentittoaWelshfootiefanandnevergotitback]soIwillrefrainfrommakingwildpredictionsHoweverIwillstatethefollowinghellipIrrespectiveofwhathappenspostreferendumthefollowingremainsunalteredhellipdemandandsupplyofhousingYesmortgageratesmaychangeandmortgagesmaybecomemoreorlessaccessiblendashindeedwemayallfeellikewehavemoreorlessmoneyinourpocketndashbutultimatelyweallstillneedsomewheretoliveInconclusionIthinkthechoiceyouhaveasapropertyinvestoriswhetheryouallowexternaleventstodictateyouractionsorwhetheryougrabthebullbythehornsandcreateyourownoutcomeIdonrsquotknowaboutyoubutIknowwhichoneIprefer
ThesecondgrouparetheaccidentallandlordsThesepeoplearenrsquotreallyinvestorsatallThisisthegroupwhoifthewindchangeswillmostsurelyfeeltheeffectsmostkeenlyWhyare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
16
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
MortgagesByMatthewJonesofMoneywatchFinance01217453347AlltoooftenpeopledecidetobuyapropertywithoutconsideringtheimportanceofgettingtheirfinancialduckslinedupWehavehadinstancesinthepastwherepeoplehavespentmanymonthssearchingfortheidealbuytoletpropertyonlyforeverythingtofallapartbecausetheyhadnrsquotdonethebasicsIwouldencourageanyinvestorlookingtobuytolettotakeacarefullookattheirowncreditreportsomethingthebankswilluseinthedecisionmakingprocessoftenmakingitthefirstthingtheycheckviaanautomatedprocessldquocomputersaysnordquoThethreecreditbureausintheUKarecurrentlyExperianEquifaxandCallCreditThefirsttwowillallowyouaccesstoyourcreditreportforthefirst28daysforfreebutwhatmanypeopledonotknowisthatCallCreditallowsyouaccesstoyourrecordsfreeofchargeforlifeviathewebsitewwwnoddlecoukWehavehelpedmanyinvestorsoverthepastfewyearsimprovetheircreditscoreHereareafewsimpleyeteffectivetipsUseyourcreditcardandclearitinfulleverymonthtohelpbuildyourcreditscoreDonrsquotuseyouroverdraftLendersnowtreatoverdraftsthesameastheywouldpaydaylendingBettertohavepound1000inyourcurrentaccountconstantlyandpound1000lessinyoursavingsaccountsMakesureyouareontheelectoralroll-againwehaveseeninvestorswithlargedepositsanddecentincomesfailthelendersinitialchecksbecausetheywerenrsquotontheelectoralrollFinallydonrsquotassumebuytoletlenderswonrsquotbeinterestedinyourincomeThingshavechangedandthemarketisalottighternowadayswithalotmore
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
17
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ReferencingThesadfactisthatevengoodtenantscanturnbadsonoamountofreferencingorcreditcheckswillcompletelyeliminateyourrisksHoweverwithacombinationofthoroughreferencingcreditchecksandtoppingitalloffwitharentguaranteeyoucertainlycanminimiseyourexposuretofinanciallossWhilstnotimpossibleitcanbedifficultforlandlordstodoacreditcheckonpotentialtenantsThisiswhymanylandlordspreferthistobedonebyalettingagentHoweverasabareminimumIwouldsuggestthatanylandlordshouldcheckthefollowing
Checkthatyourpotentialtenantcancomfortablyaffordtherent(30xmonthlyrentasanannualincomeisagoodguide)CheckwiththelandlordhowtheirprevioustenancywasconductedCheckthatpotentialtenantshavethelegalrighttoresideandrentintheUK(seenextsection)
FinallyandthisissomethingwhichmostagentswontsaytoyoubutIwillasIamalsoalandlordsoIwill-useyourgutinstinct
ImnotsayingyoucanrelyonyourgutinstincttospotagoodtenantbutifyourgutinstincttellsyouthatapotentialtenantwillbeproblematicthenyoureprobablycorrectAlotofthisboilsdowntoexperiencebutsuchthingswhichsometimesringalarmbellswithmeinclude
BeingabsolutelydesparatetomoveinOfferingtopayalargerdepositoreventhefullrentupfrontfornoapparentreasonBeingunabletoprovidefullreferencesViewingonbehalfofsomeoneelsewhoyouareunabletomeetuntilthemovein
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
18
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
19
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
20
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
21
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
22
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
13
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
LetrsquosfirstlookattheaskingpricesAtaglancetheaverageaskingpricetodayofaonebedroomflatinMoseleyispound90000Incontrasttheaverageaskingpriceforatwobedispound133000SowhatabouttherentsWellbasedonwhatisadvertisedtodayonZooplaatypicalonebedroomflatisadvertisedwitharentalpriceofpound500percalendarmonthandatwobedatpound610permonthTranslatethisintoyieldsandthatrsquosayieldof66fortheonebedagainst55forthetwobedSopurelyintermsofachievableyieldstheonebedisthebetteroptionButwhataboutcapitalappreciationWellthisiswhereitgetsabitmoredifficultNormallyifIwasgoingtopredictpotentialforcapitalappreciationIwouldlooktopreviousyearsrsquogrowthasanindicatorHoweverthepastdecadehasbeenaturbulenttimeforpropertyownersandnomoresothanforthosewhoboughtflatsinMoseleyArapidincreaseinthebuildingofnewflatscoupledwiththenationwideeconomicproblemsresultedinvaluesstagnatingoreveninnegativegrowthforsomeThankfullythingsseemtohavesettledsomewhatandifyouwerebuyingaflatnowyoucoulddosowithalotmoreconfidenceAstwobedsappealbothtohomeownersandbuytoletinvestorsthesenormallyofferbothbettercapitalappreciationandareeasiertosellinthelongrunOfcourseanotheroptionwouldbetofocusinsteadonhouseswhichhavecontinuedtoappreciate
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
14
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ShouldyoubeworryingaboutBrexitUnlessyoursquovebeenlivinginacavetheselastcoupleofweeksyoursquollhavestruggledtoescapethetorrentofdiscussionsconjecturesandanalysisinthemediaofthesocalledBrexitWhetheritisrightorwrongremainstobeseenandsurelywewillonlytrulybeabletojudgewiththebenefitofhindsighthoweveronethingwhichseemstohavebeenmissedbythemainstreammediaisthepotentialimpactontheUKpropertymarketNowyoumightsaythatthereasonthishasnrsquotbeendiscussedisbecausetheeffectislargelyunknownbutIwouldsaythatthisisnotthereasonAfterallwhodoesreallyknowatthisstagetheimpactofanimpendingdivorcefromtheEUonanyspecificaspectoftheUKeconomyEventhefutureoftheNHSwhichwasamajorpointoffocusduringthepre-referendumcampaigningseemstobeinquestionSowhyhastheimpactontheUKpropertymarketnotbeensowidelydiscussedintheensuingweekssincethereferendumMyopinionisthisndashpropertyinvestorsfallintooneoftwocampsSeriousinvestorswhohaveclearlydefinedobjectivesfortheirpropertybusinessesThesepeoplehavenrsquotgotintopropertyonawhimInsteadtheyhavethoughtaboutitplannedforitandindeedtheyhaveputinplacecongruentstrategieswhichhelpthemmeettheirobjectivesSuretheymaynowbeconcernedaboutwhatmaychangeintheensuingmonthsandyearsbuttheywilllargelyadaptanddevelopnewtacticswhichwillallowthemtonotonlywhetheranstormbutalsotakeadvantageoftheprevailingconditionsSowhyisthisgroupnottalkingaboutBrexitSimplebecausetheyarebusydoinghellipbusythinkingplanningreviewingandadapting
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
15
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
thesepeoplenottalkingaboutBrexitBecauseiftheydidnrsquothaveaplanpre-referendumtheymostlikelydonrsquothaveonenowTobeblunttheyrsquorestickingtheirheadinthesandNowincaseyouthinkIrsquombeingoverlyharshtothissecondgroupletrsquosbeclearndashIhavemassivesympathyforaccidentallandlordsManyofmyclientsfallintothisgroupandtheyarenotinthispositionbecausetheychosetobeMaybetheyboughtatthepeakofthemarketandfoundthemselvesbeingunabletomovewhentheirfamilygrewOthersnodoubtownedhomespriortomeetinggirlfriendsboyfriendshusbandsandwivesOvertheyearstheadvicehasoftenbeengiventhatifyoucanrsquotselljustrentNeverthelessmypointremainsthattheydidnotactivelychoosetobeinthispositionSowhatwillhappentotheUKpropertymarketAtthetimeofwritingIamseparatedfrommycrystalball[IlentittoaWelshfootiefanandnevergotitback]soIwillrefrainfrommakingwildpredictionsHoweverIwillstatethefollowinghellipIrrespectiveofwhathappenspostreferendumthefollowingremainsunalteredhellipdemandandsupplyofhousingYesmortgageratesmaychangeandmortgagesmaybecomemoreorlessaccessiblendashindeedwemayallfeellikewehavemoreorlessmoneyinourpocketndashbutultimatelyweallstillneedsomewheretoliveInconclusionIthinkthechoiceyouhaveasapropertyinvestoriswhetheryouallowexternaleventstodictateyouractionsorwhetheryougrabthebullbythehornsandcreateyourownoutcomeIdonrsquotknowaboutyoubutIknowwhichoneIprefer
ThesecondgrouparetheaccidentallandlordsThesepeoplearenrsquotreallyinvestorsatallThisisthegroupwhoifthewindchangeswillmostsurelyfeeltheeffectsmostkeenlyWhyare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
16
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
MortgagesByMatthewJonesofMoneywatchFinance01217453347AlltoooftenpeopledecidetobuyapropertywithoutconsideringtheimportanceofgettingtheirfinancialduckslinedupWehavehadinstancesinthepastwherepeoplehavespentmanymonthssearchingfortheidealbuytoletpropertyonlyforeverythingtofallapartbecausetheyhadnrsquotdonethebasicsIwouldencourageanyinvestorlookingtobuytolettotakeacarefullookattheirowncreditreportsomethingthebankswilluseinthedecisionmakingprocessoftenmakingitthefirstthingtheycheckviaanautomatedprocessldquocomputersaysnordquoThethreecreditbureausintheUKarecurrentlyExperianEquifaxandCallCreditThefirsttwowillallowyouaccesstoyourcreditreportforthefirst28daysforfreebutwhatmanypeopledonotknowisthatCallCreditallowsyouaccesstoyourrecordsfreeofchargeforlifeviathewebsitewwwnoddlecoukWehavehelpedmanyinvestorsoverthepastfewyearsimprovetheircreditscoreHereareafewsimpleyeteffectivetipsUseyourcreditcardandclearitinfulleverymonthtohelpbuildyourcreditscoreDonrsquotuseyouroverdraftLendersnowtreatoverdraftsthesameastheywouldpaydaylendingBettertohavepound1000inyourcurrentaccountconstantlyandpound1000lessinyoursavingsaccountsMakesureyouareontheelectoralroll-againwehaveseeninvestorswithlargedepositsanddecentincomesfailthelendersinitialchecksbecausetheywerenrsquotontheelectoralrollFinallydonrsquotassumebuytoletlenderswonrsquotbeinterestedinyourincomeThingshavechangedandthemarketisalottighternowadayswithalotmore
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
17
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ReferencingThesadfactisthatevengoodtenantscanturnbadsonoamountofreferencingorcreditcheckswillcompletelyeliminateyourrisksHoweverwithacombinationofthoroughreferencingcreditchecksandtoppingitalloffwitharentguaranteeyoucertainlycanminimiseyourexposuretofinanciallossWhilstnotimpossibleitcanbedifficultforlandlordstodoacreditcheckonpotentialtenantsThisiswhymanylandlordspreferthistobedonebyalettingagentHoweverasabareminimumIwouldsuggestthatanylandlordshouldcheckthefollowing
Checkthatyourpotentialtenantcancomfortablyaffordtherent(30xmonthlyrentasanannualincomeisagoodguide)CheckwiththelandlordhowtheirprevioustenancywasconductedCheckthatpotentialtenantshavethelegalrighttoresideandrentintheUK(seenextsection)
FinallyandthisissomethingwhichmostagentswontsaytoyoubutIwillasIamalsoalandlordsoIwill-useyourgutinstinct
ImnotsayingyoucanrelyonyourgutinstincttospotagoodtenantbutifyourgutinstincttellsyouthatapotentialtenantwillbeproblematicthenyoureprobablycorrectAlotofthisboilsdowntoexperiencebutsuchthingswhichsometimesringalarmbellswithmeinclude
BeingabsolutelydesparatetomoveinOfferingtopayalargerdepositoreventhefullrentupfrontfornoapparentreasonBeingunabletoprovidefullreferencesViewingonbehalfofsomeoneelsewhoyouareunabletomeetuntilthemovein
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
18
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
19
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
20
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
21
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
22
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
14
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ShouldyoubeworryingaboutBrexitUnlessyoursquovebeenlivinginacavetheselastcoupleofweeksyoursquollhavestruggledtoescapethetorrentofdiscussionsconjecturesandanalysisinthemediaofthesocalledBrexitWhetheritisrightorwrongremainstobeseenandsurelywewillonlytrulybeabletojudgewiththebenefitofhindsighthoweveronethingwhichseemstohavebeenmissedbythemainstreammediaisthepotentialimpactontheUKpropertymarketNowyoumightsaythatthereasonthishasnrsquotbeendiscussedisbecausetheeffectislargelyunknownbutIwouldsaythatthisisnotthereasonAfterallwhodoesreallyknowatthisstagetheimpactofanimpendingdivorcefromtheEUonanyspecificaspectoftheUKeconomyEventhefutureoftheNHSwhichwasamajorpointoffocusduringthepre-referendumcampaigningseemstobeinquestionSowhyhastheimpactontheUKpropertymarketnotbeensowidelydiscussedintheensuingweekssincethereferendumMyopinionisthisndashpropertyinvestorsfallintooneoftwocampsSeriousinvestorswhohaveclearlydefinedobjectivesfortheirpropertybusinessesThesepeoplehavenrsquotgotintopropertyonawhimInsteadtheyhavethoughtaboutitplannedforitandindeedtheyhaveputinplacecongruentstrategieswhichhelpthemmeettheirobjectivesSuretheymaynowbeconcernedaboutwhatmaychangeintheensuingmonthsandyearsbuttheywilllargelyadaptanddevelopnewtacticswhichwillallowthemtonotonlywhetheranstormbutalsotakeadvantageoftheprevailingconditionsSowhyisthisgroupnottalkingaboutBrexitSimplebecausetheyarebusydoinghellipbusythinkingplanningreviewingandadapting
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
15
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
thesepeoplenottalkingaboutBrexitBecauseiftheydidnrsquothaveaplanpre-referendumtheymostlikelydonrsquothaveonenowTobeblunttheyrsquorestickingtheirheadinthesandNowincaseyouthinkIrsquombeingoverlyharshtothissecondgroupletrsquosbeclearndashIhavemassivesympathyforaccidentallandlordsManyofmyclientsfallintothisgroupandtheyarenotinthispositionbecausetheychosetobeMaybetheyboughtatthepeakofthemarketandfoundthemselvesbeingunabletomovewhentheirfamilygrewOthersnodoubtownedhomespriortomeetinggirlfriendsboyfriendshusbandsandwivesOvertheyearstheadvicehasoftenbeengiventhatifyoucanrsquotselljustrentNeverthelessmypointremainsthattheydidnotactivelychoosetobeinthispositionSowhatwillhappentotheUKpropertymarketAtthetimeofwritingIamseparatedfrommycrystalball[IlentittoaWelshfootiefanandnevergotitback]soIwillrefrainfrommakingwildpredictionsHoweverIwillstatethefollowinghellipIrrespectiveofwhathappenspostreferendumthefollowingremainsunalteredhellipdemandandsupplyofhousingYesmortgageratesmaychangeandmortgagesmaybecomemoreorlessaccessiblendashindeedwemayallfeellikewehavemoreorlessmoneyinourpocketndashbutultimatelyweallstillneedsomewheretoliveInconclusionIthinkthechoiceyouhaveasapropertyinvestoriswhetheryouallowexternaleventstodictateyouractionsorwhetheryougrabthebullbythehornsandcreateyourownoutcomeIdonrsquotknowaboutyoubutIknowwhichoneIprefer
ThesecondgrouparetheaccidentallandlordsThesepeoplearenrsquotreallyinvestorsatallThisisthegroupwhoifthewindchangeswillmostsurelyfeeltheeffectsmostkeenlyWhyare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
16
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
MortgagesByMatthewJonesofMoneywatchFinance01217453347AlltoooftenpeopledecidetobuyapropertywithoutconsideringtheimportanceofgettingtheirfinancialduckslinedupWehavehadinstancesinthepastwherepeoplehavespentmanymonthssearchingfortheidealbuytoletpropertyonlyforeverythingtofallapartbecausetheyhadnrsquotdonethebasicsIwouldencourageanyinvestorlookingtobuytolettotakeacarefullookattheirowncreditreportsomethingthebankswilluseinthedecisionmakingprocessoftenmakingitthefirstthingtheycheckviaanautomatedprocessldquocomputersaysnordquoThethreecreditbureausintheUKarecurrentlyExperianEquifaxandCallCreditThefirsttwowillallowyouaccesstoyourcreditreportforthefirst28daysforfreebutwhatmanypeopledonotknowisthatCallCreditallowsyouaccesstoyourrecordsfreeofchargeforlifeviathewebsitewwwnoddlecoukWehavehelpedmanyinvestorsoverthepastfewyearsimprovetheircreditscoreHereareafewsimpleyeteffectivetipsUseyourcreditcardandclearitinfulleverymonthtohelpbuildyourcreditscoreDonrsquotuseyouroverdraftLendersnowtreatoverdraftsthesameastheywouldpaydaylendingBettertohavepound1000inyourcurrentaccountconstantlyandpound1000lessinyoursavingsaccountsMakesureyouareontheelectoralroll-againwehaveseeninvestorswithlargedepositsanddecentincomesfailthelendersinitialchecksbecausetheywerenrsquotontheelectoralrollFinallydonrsquotassumebuytoletlenderswonrsquotbeinterestedinyourincomeThingshavechangedandthemarketisalottighternowadayswithalotmore
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
17
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ReferencingThesadfactisthatevengoodtenantscanturnbadsonoamountofreferencingorcreditcheckswillcompletelyeliminateyourrisksHoweverwithacombinationofthoroughreferencingcreditchecksandtoppingitalloffwitharentguaranteeyoucertainlycanminimiseyourexposuretofinanciallossWhilstnotimpossibleitcanbedifficultforlandlordstodoacreditcheckonpotentialtenantsThisiswhymanylandlordspreferthistobedonebyalettingagentHoweverasabareminimumIwouldsuggestthatanylandlordshouldcheckthefollowing
Checkthatyourpotentialtenantcancomfortablyaffordtherent(30xmonthlyrentasanannualincomeisagoodguide)CheckwiththelandlordhowtheirprevioustenancywasconductedCheckthatpotentialtenantshavethelegalrighttoresideandrentintheUK(seenextsection)
FinallyandthisissomethingwhichmostagentswontsaytoyoubutIwillasIamalsoalandlordsoIwill-useyourgutinstinct
ImnotsayingyoucanrelyonyourgutinstincttospotagoodtenantbutifyourgutinstincttellsyouthatapotentialtenantwillbeproblematicthenyoureprobablycorrectAlotofthisboilsdowntoexperiencebutsuchthingswhichsometimesringalarmbellswithmeinclude
BeingabsolutelydesparatetomoveinOfferingtopayalargerdepositoreventhefullrentupfrontfornoapparentreasonBeingunabletoprovidefullreferencesViewingonbehalfofsomeoneelsewhoyouareunabletomeetuntilthemovein
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
18
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
19
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
20
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
21
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
22
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
15
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
thesepeoplenottalkingaboutBrexitBecauseiftheydidnrsquothaveaplanpre-referendumtheymostlikelydonrsquothaveonenowTobeblunttheyrsquorestickingtheirheadinthesandNowincaseyouthinkIrsquombeingoverlyharshtothissecondgroupletrsquosbeclearndashIhavemassivesympathyforaccidentallandlordsManyofmyclientsfallintothisgroupandtheyarenotinthispositionbecausetheychosetobeMaybetheyboughtatthepeakofthemarketandfoundthemselvesbeingunabletomovewhentheirfamilygrewOthersnodoubtownedhomespriortomeetinggirlfriendsboyfriendshusbandsandwivesOvertheyearstheadvicehasoftenbeengiventhatifyoucanrsquotselljustrentNeverthelessmypointremainsthattheydidnotactivelychoosetobeinthispositionSowhatwillhappentotheUKpropertymarketAtthetimeofwritingIamseparatedfrommycrystalball[IlentittoaWelshfootiefanandnevergotitback]soIwillrefrainfrommakingwildpredictionsHoweverIwillstatethefollowinghellipIrrespectiveofwhathappenspostreferendumthefollowingremainsunalteredhellipdemandandsupplyofhousingYesmortgageratesmaychangeandmortgagesmaybecomemoreorlessaccessiblendashindeedwemayallfeellikewehavemoreorlessmoneyinourpocketndashbutultimatelyweallstillneedsomewheretoliveInconclusionIthinkthechoiceyouhaveasapropertyinvestoriswhetheryouallowexternaleventstodictateyouractionsorwhetheryougrabthebullbythehornsandcreateyourownoutcomeIdonrsquotknowaboutyoubutIknowwhichoneIprefer
ThesecondgrouparetheaccidentallandlordsThesepeoplearenrsquotreallyinvestorsatallThisisthegroupwhoifthewindchangeswillmostsurelyfeeltheeffectsmostkeenlyWhyare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
16
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
MortgagesByMatthewJonesofMoneywatchFinance01217453347AlltoooftenpeopledecidetobuyapropertywithoutconsideringtheimportanceofgettingtheirfinancialduckslinedupWehavehadinstancesinthepastwherepeoplehavespentmanymonthssearchingfortheidealbuytoletpropertyonlyforeverythingtofallapartbecausetheyhadnrsquotdonethebasicsIwouldencourageanyinvestorlookingtobuytolettotakeacarefullookattheirowncreditreportsomethingthebankswilluseinthedecisionmakingprocessoftenmakingitthefirstthingtheycheckviaanautomatedprocessldquocomputersaysnordquoThethreecreditbureausintheUKarecurrentlyExperianEquifaxandCallCreditThefirsttwowillallowyouaccesstoyourcreditreportforthefirst28daysforfreebutwhatmanypeopledonotknowisthatCallCreditallowsyouaccesstoyourrecordsfreeofchargeforlifeviathewebsitewwwnoddlecoukWehavehelpedmanyinvestorsoverthepastfewyearsimprovetheircreditscoreHereareafewsimpleyeteffectivetipsUseyourcreditcardandclearitinfulleverymonthtohelpbuildyourcreditscoreDonrsquotuseyouroverdraftLendersnowtreatoverdraftsthesameastheywouldpaydaylendingBettertohavepound1000inyourcurrentaccountconstantlyandpound1000lessinyoursavingsaccountsMakesureyouareontheelectoralroll-againwehaveseeninvestorswithlargedepositsanddecentincomesfailthelendersinitialchecksbecausetheywerenrsquotontheelectoralrollFinallydonrsquotassumebuytoletlenderswonrsquotbeinterestedinyourincomeThingshavechangedandthemarketisalottighternowadayswithalotmore
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
17
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ReferencingThesadfactisthatevengoodtenantscanturnbadsonoamountofreferencingorcreditcheckswillcompletelyeliminateyourrisksHoweverwithacombinationofthoroughreferencingcreditchecksandtoppingitalloffwitharentguaranteeyoucertainlycanminimiseyourexposuretofinanciallossWhilstnotimpossibleitcanbedifficultforlandlordstodoacreditcheckonpotentialtenantsThisiswhymanylandlordspreferthistobedonebyalettingagentHoweverasabareminimumIwouldsuggestthatanylandlordshouldcheckthefollowing
Checkthatyourpotentialtenantcancomfortablyaffordtherent(30xmonthlyrentasanannualincomeisagoodguide)CheckwiththelandlordhowtheirprevioustenancywasconductedCheckthatpotentialtenantshavethelegalrighttoresideandrentintheUK(seenextsection)
FinallyandthisissomethingwhichmostagentswontsaytoyoubutIwillasIamalsoalandlordsoIwill-useyourgutinstinct
ImnotsayingyoucanrelyonyourgutinstincttospotagoodtenantbutifyourgutinstincttellsyouthatapotentialtenantwillbeproblematicthenyoureprobablycorrectAlotofthisboilsdowntoexperiencebutsuchthingswhichsometimesringalarmbellswithmeinclude
BeingabsolutelydesparatetomoveinOfferingtopayalargerdepositoreventhefullrentupfrontfornoapparentreasonBeingunabletoprovidefullreferencesViewingonbehalfofsomeoneelsewhoyouareunabletomeetuntilthemovein
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
18
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
19
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
20
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
21
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
22
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
16
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
MortgagesByMatthewJonesofMoneywatchFinance01217453347AlltoooftenpeopledecidetobuyapropertywithoutconsideringtheimportanceofgettingtheirfinancialduckslinedupWehavehadinstancesinthepastwherepeoplehavespentmanymonthssearchingfortheidealbuytoletpropertyonlyforeverythingtofallapartbecausetheyhadnrsquotdonethebasicsIwouldencourageanyinvestorlookingtobuytolettotakeacarefullookattheirowncreditreportsomethingthebankswilluseinthedecisionmakingprocessoftenmakingitthefirstthingtheycheckviaanautomatedprocessldquocomputersaysnordquoThethreecreditbureausintheUKarecurrentlyExperianEquifaxandCallCreditThefirsttwowillallowyouaccesstoyourcreditreportforthefirst28daysforfreebutwhatmanypeopledonotknowisthatCallCreditallowsyouaccesstoyourrecordsfreeofchargeforlifeviathewebsitewwwnoddlecoukWehavehelpedmanyinvestorsoverthepastfewyearsimprovetheircreditscoreHereareafewsimpleyeteffectivetipsUseyourcreditcardandclearitinfulleverymonthtohelpbuildyourcreditscoreDonrsquotuseyouroverdraftLendersnowtreatoverdraftsthesameastheywouldpaydaylendingBettertohavepound1000inyourcurrentaccountconstantlyandpound1000lessinyoursavingsaccountsMakesureyouareontheelectoralroll-againwehaveseeninvestorswithlargedepositsanddecentincomesfailthelendersinitialchecksbecausetheywerenrsquotontheelectoralrollFinallydonrsquotassumebuytoletlenderswonrsquotbeinterestedinyourincomeThingshavechangedandthemarketisalottighternowadayswithalotmore
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
17
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ReferencingThesadfactisthatevengoodtenantscanturnbadsonoamountofreferencingorcreditcheckswillcompletelyeliminateyourrisksHoweverwithacombinationofthoroughreferencingcreditchecksandtoppingitalloffwitharentguaranteeyoucertainlycanminimiseyourexposuretofinanciallossWhilstnotimpossibleitcanbedifficultforlandlordstodoacreditcheckonpotentialtenantsThisiswhymanylandlordspreferthistobedonebyalettingagentHoweverasabareminimumIwouldsuggestthatanylandlordshouldcheckthefollowing
Checkthatyourpotentialtenantcancomfortablyaffordtherent(30xmonthlyrentasanannualincomeisagoodguide)CheckwiththelandlordhowtheirprevioustenancywasconductedCheckthatpotentialtenantshavethelegalrighttoresideandrentintheUK(seenextsection)
FinallyandthisissomethingwhichmostagentswontsaytoyoubutIwillasIamalsoalandlordsoIwill-useyourgutinstinct
ImnotsayingyoucanrelyonyourgutinstincttospotagoodtenantbutifyourgutinstincttellsyouthatapotentialtenantwillbeproblematicthenyoureprobablycorrectAlotofthisboilsdowntoexperiencebutsuchthingswhichsometimesringalarmbellswithmeinclude
BeingabsolutelydesparatetomoveinOfferingtopayalargerdepositoreventhefullrentupfrontfornoapparentreasonBeingunabletoprovidefullreferencesViewingonbehalfofsomeoneelsewhoyouareunabletomeetuntilthemovein
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
18
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
19
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
20
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
21
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
22
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
17
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ReferencingThesadfactisthatevengoodtenantscanturnbadsonoamountofreferencingorcreditcheckswillcompletelyeliminateyourrisksHoweverwithacombinationofthoroughreferencingcreditchecksandtoppingitalloffwitharentguaranteeyoucertainlycanminimiseyourexposuretofinanciallossWhilstnotimpossibleitcanbedifficultforlandlordstodoacreditcheckonpotentialtenantsThisiswhymanylandlordspreferthistobedonebyalettingagentHoweverasabareminimumIwouldsuggestthatanylandlordshouldcheckthefollowing
Checkthatyourpotentialtenantcancomfortablyaffordtherent(30xmonthlyrentasanannualincomeisagoodguide)CheckwiththelandlordhowtheirprevioustenancywasconductedCheckthatpotentialtenantshavethelegalrighttoresideandrentintheUK(seenextsection)
FinallyandthisissomethingwhichmostagentswontsaytoyoubutIwillasIamalsoalandlordsoIwill-useyourgutinstinct
ImnotsayingyoucanrelyonyourgutinstincttospotagoodtenantbutifyourgutinstincttellsyouthatapotentialtenantwillbeproblematicthenyoureprobablycorrectAlotofthisboilsdowntoexperiencebutsuchthingswhichsometimesringalarmbellswithmeinclude
BeingabsolutelydesparatetomoveinOfferingtopayalargerdepositoreventhefullrentupfrontfornoapparentreasonBeingunabletoprovidefullreferencesViewingonbehalfofsomeoneelsewhoyouareunabletomeetuntilthemovein
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
18
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
19
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
20
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
21
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
22
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
18
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ImmigrationchecksAsalandlordyouhaveadutyundertheimmigrationacttocheckthatanypotentialtenantshavethelegalrighttoresideandrentintheUKYoucandothisbycheckingtheirpassportiftheyareaUKorEUcitizenoriftheyareanonEUforeignnationalbycheckingtheirpassportandanynecessaryvisasYoushouldalsobeawarethatanychildrenundertheageof18shouldberecheckedupontheir18thbirthdayandalsothatvisaandthelikearesubjecttoexpirydatesandconsequentlyrecheckingwillberequiredBeawareatthetimeofwritingandfollowingthereferendumontheUKleavingtheEUthismaybesubjecttochange
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
19
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
20
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
21
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
22
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
19
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
BudgetToooftennewinvestorsonlyconsiderhowmuchmoneytheyneedforthedepositandneglecttheothercostsThisisbynomeansanexhaustivelistbuttheseareatleastsomeoftheothercostswhichyoushouldfactorinpriortobuyingapropertyDepositforthemortgagemoneytorefurbishthepropertysolicitorcostsmortgageapplicationfeesbrokerfeessurveyfeesmortgagerepaymentswhilstthepropertyisemptyfollowinglegalcompletionpotentialcostsincurredduetoabortivecancelledsalesAndthentherearethecostsoftimesuchasTimeoffworkassessingareastimespentviewingpropertiestimespentdealingwiththesolicitorstonamebutafew
StrategySuchacommondilemmandashdoyoubuyjustonelargepropertyoranumberofsmallerandlessexpensiveones
OfcourseyoucanlookatitfromthepointofviewofwhetheronepropertyorafewsmalleroneswouldgiveabetteryieldorpotentialforcapitalappreciationbutIwouldlookatitinaslightlydifferentway-
IwouldaskyourselfthequestionofwhichisthelessriskyputallyoureggsinonebasketinbuyingonepropertyorspreadtheriskandbuyafewYouseeifonepropertyisvacantortherentnotpaidandthisistheonlypropertyyouownthenyourincomegoesfrom100tonothinginonefellswoopHoweverifyouhavesayfoursmallerpropertiesandthesamethinghappensthenyouhavelostjust25ofyourincomeassumingofcoursethateachpropertybringsyouinanidenticalincome
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
20
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
21
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
22
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
20
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
HealthandSafetyFurnitureTheFireandSafetyRegulations(softfurnishings)statesthatallfurnishings(bedssofaschairsandthelike)complywiththelatestfireregulationsEnsurethatyoudonothaveanynon-compliantfurnishingsinarentalpropertyIMPORTANTFailuretocomplywiththeFurnitureandFurnishingsRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987whichcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentFrom1stJanuary1997allupholsteredfurnitureinrentedaccommodationmustcomplywiththefireresistancerequirementsoftheFurnitureandFurnishings(Fire)(Safety)Regulations1988(asamended)Allupholsteredorpart-upholsteredfurnitureiscoveredbytheregulationsincludingmattressespillowsandcushionsEachpieceoffurniturethatcomplieswiththeseregulationsshouldhavearectangularlabelpermanentlyattachedtoitwiththeheadingldquoCARELESSNESSCAUSESFIRErdquoIfthefurniturewasproducedpriorto1988ordoesnothavetheabovelabelitwillprobablynotcomply(apartfromantiquesmadebefore1950)
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
21
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
22
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
21
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
ElectricalchecksAnelectricalsafetycheckmustbecommissionedpriortothecommencementofatenancyandmustbecarriedoutbyacompetentperson(aPartPqualifiedelectricianinkitchensandbathrooms)toensurethattheelectricitysupplyandallappliancesarelegalThisincludessupplyinginstructionbookswhereneededforsafeuse
IMPORTANTFailuretocomplywiththeElectricalRegulationsmayconstituteacriminaloffenceundertheConsumerProtectionAct1987thatcarriesamaximumpenaltyonsummaryconvictionofapound5000fineandorsixmonthsimprisonmentThisLegislationmeansthatLandlordshavealegalobligationandadutyofcaretotenantstoensurethattheelectricalinstallationandtheelectricalequipmentsuppliedissafe
TheElectricalEquipment(Safety)Regulationshavebeenmandatorysince1stJanuary1997TheystatethatallelectricalapplianceswithletaccommodationmustbesafeThisappliestobothnewandsecond-handappliancesandcoversallelectricalitemssuppliedfortheintendeduseoftheTenantTheregulationsalsocoverfixedappliancessuchascookersetcTheonlymethodofinsuringthattheseappliancesaresafeistohavethemtestedbyatrainedelectricalengineerusingtheportableappliancetestingequipmentknownasa(PAT)testWhatdoesthismean
AllelectricalsystemsitemsmustbebullCertifiedsafewhenatenancybeginsbullMaintainedinasafeconditionthroughoutthetenancybullMaintainedonlybylsquocompetentpersonsrsquobullFitforpurposeandfreeofdefectsWhatshouldIasalandlorddoAsaminimumhaveanannualelectricalsafetyinspection(ietheEnhancedElectricalinspectionorrdquoE2rdquo)whichincludestheelectricalequipmentEnsureanyinstallationormaintenanceworksaredonebyPartPlsquocompetentpersonsrsquo
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
22
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
22
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
GassafetyAsalandlordyouareresponsibleforthesafetyofyourtenantsTheGasSafety(InstallationandUse)Regulations1998dealwithlandlordsrsquodutiestomakesuregasappliancesfittingsandfluesprovidedfortenantsaresafe
AppliancesfittingsandfluesinacommunalareabutwhichmaybeusedbytenantsarealsoincludedYouareresponsibleforthemaintenanceandrepairoffluesappliancesandpipeworkprovidedforyourtenantsusebyaGasSaferegisteredengineerAlthoughthereisnoprescribedtimeframeforthesedutiesgoodpracticewouldbethedemonstrationofregularannualmaintenancechecksandsubsequentrepairs
Youarealsoresponsibleforensuringanannualgassafetycheckiscarriedoutwithin12monthsoftheinstallationofanewapplianceorfluewhichyouprovideandannuallythereafterbyaGasSafeRegisteredengineerYoumustkeeparecordofthesafetycheckfor2yearsandissueacopytoeachexistingtenantwithin28daysofthecheckbeingcompletedandissueacopytoanynewtenantsbeforetheymovein
Whatgasappliancesareyouresponsibleforasalandlord
AnygasappliancethatyouownandprovideforthetenantsuseisincludedinyourlegaldutiesIfatenanthastheirowngasappliancethatyouhavenotprovidedthenyouhaveresponsibilitiesforpartsoftheassociatedinstallationandpipeworkbutnotfortheactualappliance
Therearesomegoodpracticemeasuresthatyoucouldadoptwithappliancesthattenantsown
1SendaremindertothetenantthattheirappliancesshouldbeservicedandcheckedforsafetyeachyearbyaGasSaferegisteredengineerandwherepossibleoffertoincludethese(atreasonablecost)withingassafetymaintenanceundertakenonyourbehalf
2Atthestartofthetenancyadvisethetenantofanyfluesorchimneysthatare
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
23
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
unsuitablefortheinstallationofagasapplianceYoumayalsowishtoconsiderregulatingtheinstallationofanyappliancebyatenantthroughtheconditionsofthetenancyagreement
3Itisalsorecommendedtoincludeallflues(egchimneys)connectedtogasapplianceswithinyourlandlordsgassafetycheckevenwheretheydonotserveappliancesprovidedbythelandlordThismayalsohelptofulfilotherlegaldutiesundertheHealthandSafetyatWorketcAct1974
4Free-standingcookersconnectedbyaflexibleconnector(bayonetfitting)arenotconsideredtobelsquoreadilymovablersquobutcanbemovedtemporarilyegtocleanthespacetheynormallyoccupythistypeofactivityisnotregardedaslsquoworkrsquowithinthemeaningoftheseRegulations
AnyothertypeofinstallationreinstallationisregardedasgasworkandmustbecarriedoutbyaGasSaferegisteredengineer
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
24
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Authorsnote
IsincerelyhopeyouveenjoyedreadingthisshortbookandyouhavefoundsomeoftheideasandinformationdiscussedusefulInwritingthisIrealisedjusthowmuchthereistoshareonthetopic-notsurprisingIsupposeconsideringthatIvebeenintheindustrysince2002
ThisiswhyintheendIdecidedtomakethisPart1ofatwopartseriesSoifyoufeellikethereareimportanttopicswhichhavebeenmissedoutyoureprobablyright
InPart2Iwillbediscussing
HMOsKeepingyourrepairbillsdownKeepinggoodtenantsPreventingendoftenancyproblemsEnsuringrentcomesinontimeeverytimeDealingwithdampandcondensationPlanningarefurbishmentArticle4LegalnoticesSelfmanageoremployanagentBuyingtorenovate(flip)Workingwithcontractors
AtthetimeofwritingPart2isstillaworkinprogresssoifyoudliketoreserveyourFREEcopyjustdropmealinetodanielsperberconcentricpropertycouk
Ifyouvegotanyquestionsaboutanyofthetopicsinthisbookorneedanyfurtherhelpthenfeelfreetogivemeacallon0121405038907854577566
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
25
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
26
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution
Acknowledgements
ThankstoMattJonesfromMoneywatchFinanceforhissectiononMortgages
SectionsonGasSafetyElectricalSafetyandFireSafetyarereproducedwithpermissionunderOpenGovernmentLicenceandaresourcedfromhttpswwwnidirectgovuk
DanielSperberisfounderownerandco-directorofConcentricSalesampLettingsEdgbastonHisagencyworkswithlandlordsandinvestorsatalllevelsinsellinglettingmanagingandalsoacquiringresidentialpropertyintheBirminghamarea
ProofCopyNotoptimisedforhighqualityprintingordigitaldistributionProofCopyNotoptimisedforhighqualityprintingordigitaldistribution