What is the good, bad &ugly of PROPERTY LETTING?

Question

I want to hear from any kind of letting agent/landlord - the benefits and disadvantages of letting residential & commercial properties in the UK. What kinds of profits are expected. Anything they can comments about teh tenants. What percentage (approx) don't pay or cause hassles and what are they??

Answer 1

For some where like london as long as you are not under a flight path or something the chances of property value decresing is too small to think about. So on a rented property you could expect at least £200 a month after paying the mortgage. Personally, I think it pays more to buy run down properties at auction, do it up and sell if you are up for a challenge, much more worth it.

For tenants, don't do too flashy, they'll never appreciate it (for stress free lettings, give to companies that specialise in lettings for government or something, then you will sign a 3-5 yr contract and always get paid on time even if they dont have tenants)

sorry abit long.

Answer 2

Profits tend to vary significantly across the country, however, in the south of England, a property worth £200k - £250k should fetch in the region of £750-£900 per month depending on condition.

The biggest hassle with letting is the tenants (no surprise there). If you're lucky and get good tenants, letting can be hassle free, especially if you employ an agent to maintain the property. Bad tenants can be the bain of your life, however, despite how it may seem, the law is more on the side of the Landlord.

The thing to watch out for is that once you have let the property, the tenant has 6 months security of tenure, meaning that they cannot be evicted for at least 6 months unless there is a significant breach of the tenancy. It would be a very good idea to make sure you have rent guarantee insurance as this will cover you should the tenant default in rent. Most policies also come with legal costs which means you won't pay a penny in legal proceedings should you need to evict the tenants for rent default or selected other breaches.

The majority of tenants are absolutely fine and the few that are problematic usually don't know the law so you can easily scare them with legal jargon and them sorted out.

If there is one piece of advise I can give it would be to use a letting agent (preferably an ARLA member) as they will do everything for you including arranging maintainance and collecting rent. Many Landlords live overseas and have no problems!!

Answer 3

Good - someone else paying your mortgage and you get all the profit when you sell at the end of it all

Bad - You have to maintain the property yourself or pay someone else to do it, including any problems with the boiler, heating or anything.

Ugly - Tenants who don't pay or who breach contract early. Tenants who cause damage to the property when they move on.

The best thing to do is get a lettings agent to manage the property for you. It will cost but will save a lot of hassle along the way, plus you have more protection that way.

Answer 4

I think it is a long term investment, rather than a quick fix. Ring a letting agent in your arae as obviously things change all over the country.