In this three-minute read, we outline the costs and
expenses landlords encounter when letting a property.

To
succeed as a landlord, you need to have a realistic idea about the costs you'll
encounter when letting out a property.

Many
people think that being a landlord is child's play; they assume that once the
tenant has the keys, the only thing left to do is collect the rent each month.

But
the truth is, letting a property comes with an array of grown-up financial and
legal responsibilities. If you're not on top of your obligations, you could
lose money or wind up in court (or both).

Here's
a list of all the costs that are part and parcel of being a landlord in Mid
Kent.

Mortgage
repayments

Mortgage
repayments are the most significant monthly outgoing for most landlords. If
you're looking for certainty about the size of your monthly repayments, opt for
a fixed-term rate.

Insurance
costs

Landlord
insurance is a condition of most buy-to-let mortgages. You can opt for a
general policy (this should cover property liability, buildings insurance,
contents, and loss of rent) or one that is more far-reaching (but will have
higher premiums).

Maintenance
and repairs

All
properties require general maintenance from time to time. Landlords must ensure
the property is safe (that means keeping up to date with things like gas and
electricity safety checks) and in good condition. Set aside funds to cover this
and any repairs that may crop up (property experts suggest between 5% and 10%
of annual rent).

Service
charges and other fees

If
your property is in an apartment block, you may need to pay a service charge or
ground rent. Leasehold property owners may also have to contribute to the cost
of work carried out in communal areas.

Covering
vacant periods

Even
the most optimistic and diligent landlord should be prepared for a property to
be empty for a short period between tenancies. It's also possible that a tenant
could fall behind on the rent. Set aside at least six weeks’ rent to cover
yourself.

Tax

The
rules around what you can and can't claim as a landlord have tightened in
recent years. To ensure you pay what you should, and claim that to which you're
entitled, do your research and keep all relevant receipts and paperwork.

Finding
a tenant and credit checks

Some
DIY landlords do these things themselves, but most good landlords leave it to
the pros and use an experienced letting agent. The DIY route will save you a
few quid upfront – but it could cost you much more in the long run (think of
the legal bills if it all goes wrong). A good letting agent will have years of
experience at sourcing good tenants, checking references, and spotting trouble
in advance.

Property
management fees

A
letting agent will handle the big and little stuff for you: the paperwork, the
people management, the legal checks, the inspections, and disputes. As a
landlord, you could do this for yourself. It will save you some money but cost
you in terms of time and energy.

Here
at CWB Property, we can take the stress out of managing a rental
property, so you can sleep easy at night. Get in touch if you have any
questions, we're here to answer your queries.

Copyright
2020 CWB Property