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Rental Prices to Rise

The rate at which rents will increase is likely to triple this year. Landlords are forcing tenants to bear their financial burden as a result of the rising inflation. Experts say the major causes of the increase in the price of stamp duties and the result of the EU referendum.

Brexit had caused a lot of uncertainty in the housing market. The effect may likely linger thereby causing an increase in rent. In 2016, indices, as published by the office for National statistics, shows that the price for most properties was high across the UK. According to the report, the number of buyers has increased compared to the number of houses on sale. Brexit caused share prices of many estate agents to tumble.

According to a report published last year by Landbay, rents rose by about 1.12 percent in 2016 till November. This simply means that the tenants who rent from private landlords are totaled at £1,188 per calendar month, an increase from £1,177 at the turn of the year, an extra £11 each month or £132 per year.

According to John Goodall the Chief executive of Landbay, the stability that renters enjoyed last year may not be the case this year. He attributed the stability to the raft of regulations, political and economic challenges that came to bear on the buy-to-let sector in 2016.

Last year a new stamp duty levy was imposed on landlords who purchase new buy-to-let properties in April 2016 which caused a hike of buy-to-let purchases in the first three months. These properties were then released for tenants to rent during the summer. It provided more choice and it reduced rents temporarily.

This year, the Bank of England is likely to introduce tighter mortgage control measures and tax relief’s will be removed for buy-to-let. These measures would exert more pressure on most landlords finances. The resultant effect would be a hike in rent.

Jake Russell, who is the director at Russell Simpson said unlike 2014, 2015, and 2016, this year is full of uncertainty and would breed caution and a lot of indecision in the housing market.

However, on the contrary, James Evans, CEO of estate agency of Douglas & Gordon believes that no matter the uncertainty, there is hope for the housing market. According to him, history suggests that after years of low transactions is followed by years of increased activity.

Some areas in Birmingham Curzon street have experienced rent increase of about 23.7 within a period of five years. This is high compared to the national average of 8.8 percent. Presently, rents in Birmingham have also increased to about 22.4 percent. Other cities like Leeds and Sheffield have experienced an increase in rent by 15 percent since January 2012.

Londoners who reside in boroughs close to future Crossrail 2 stations will also experience an increase in their rent.

Let your property

This is a full money making guide to rent out your property whether it be a house or an apartment. This guide will assume you already have your property ready to let, if you have not please see our guide to Buying a property to let.

If you’re thinking about letting out a property you own it can be a great money maker, not only will you get rent each month you will also most likely make money on the property itself when it rises in value. Many people just make money through rentals and we’ll show you how to rent your own. However renting out your property isn’t all bliss and there can be many complications from costly repairs to bad tenants. Before reading on you may want to read our “Guide to being a Landlord

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With Estate Agents / Letting Agents

If you’ve bought a property purely to let out them I’m sure you’ve already done this step and had it valued by several independent agents. If you have not then don’t skip this step. You’ll need to call at least 3 estate agents to come out and value your property that you intend to rent. While they are out you will also want to find out what their finders fee is.

You can also find out what percentage they charge for managed however we recommend managing it yourself as most agents take 10% of your monthly rent and for what they actually do it isn’t worth it. If you’re not comfortable managing it yourself then make sure you get a good rate. We use estate agents to find us a tenant and draw up the contract as that’s not something you want to do yourself unless you know what you’re doing. For our rental it was £300 + Vat, this varied from around £180 – £500. You will be surprised how much the valuations will vary too. We got rental figures from around £575 to £700 per month.

Don’t just go for the estate agent that gives you the highest valuation as there’s a good chance you won’t get it and they’ll be calling you up a few weeks later asking you to drop the price. Go with the one you think will do the best job. Once you’ve picked go ahead and get it advertised, the quicker you do the quicker you start getting income.

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Without Estate Agents / Letting Agents

If you’d like to let out your property by yourself without letting agents then it’s still best to get a few out to value your property so you have a better idea on how to price it. These are a few different methods to market your property:

  • A Sign – Depending on where your property is positioned it may be good to put a sign in the window, very simple yet can be very effective.
  • Social Media – There are many Facebook pages that you can join and list your property to rent, this is completely free and one of the best methods.
  • eBay / Gumtree – You can list your property on eBay and Gumtree, Gumtree is free to list which eBay charges are applicable.

Marketing your property yourself for free can be tough. You really need to get listed on Rightmove or other similar websites to get your property seen. Try online estate agents rather than local estate agents that take a percentage. Check out our “Best online estate agents” Guide.

When you find your tenant you need to do the same things a letting agent would do. You can perform several checks on your tenant such as Credit checks. You will also need to get a tenancy agreement contract; you can get one of these from your local post office or via an online source.

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Furnished or Unfurnished?

Next you need to decide whether you’re going to let your flat out as furnished or unfurnished. Your estate agent will give you advice on this too. For our project we decided to go for unfurnished as it was a new build and believe unfurnished is the better option anyway. However we still did the basics such as Mirrors, toilet role holders, towel racks, coat pegs, curtain poles and blinds. It’s best to do these as you don’t want your tenant drilling into your walls as you can’t be sure if it will be a good job or not.

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Inspection Report

Your letting agent will do this for you but it’s always could to do one yourself. You basically want to make a list of everything about your property and it’s condition along with photographic evidence. You need to do this encase the tenant ends up damaging anything when they leave this way you can receive money from their deposit to repair any issues. Make sure to take lots of photos all over the property including walls, fixtures and fittings, appliances, carpets etc.

This is quite a basic list of the few steps it takes to let out your property. Don’t forget to consider your time when doing all of this, It might seem like a good idea to go without an estate agent but if it takes your twice as long to get it rented you’ll lose money. Once you’ve rented it out make sure you leave everything the tenants will need on the kitchen counter such as information about appliances, contact information etc.

Be sure to keep up date with any safety checks and do not let the tenant fall behind on rent! Good luck!

How to Successfully Rent Out Residential Property

Traditionally the UK property market has been more focused on owner occupiers as opposed to landlords and tenants. Unlike Germany and France, where under 50% of property is owner occupied. Until 2001 over 69% of property was owner occupied, but that trend is changing, and today the number of people renting property is at its highest level since the early 1960s.

This change in renting policy has come about for a number of pertinent reasons. Buying property has become enormously expensive, and as a result, property has slowly been moving out of reach for young first-time buyers who are now being forced to rent. In the 1980’s the average age of the first time buyer was mid-to-late twenties, while today that has risen to mid-thirties. As a consequence, the demand for rental property has increased and for longer rental periods, which is all good news for landlords.

In addition, in the UK residents were driven by political and social motivation to own their own homes. Renting was seen as a ‘waste of money’. Today the social ‘stigma’ of renting has disappeared, instead being replaced by practicality and the understanding that despite the fact mortgage interest rates have remained ridiculously low for a number of years now, this has done little other than help fuel the rise in property prices, taking them further out of reach of current tenants who aspire to be a home owner.

As an example, UK property prices on average rose by nearly 7% in 2015, yet wages only went up by 2%.

With London property prices predicted to rise by some 50% over the next 10 years (according to the Financial Times) it is becoming abundantly clear that the number of tenants will also increase as property becomes more and more unaffordable for the younger generations.

Everything points towards investing in property on what is referred to as a ‘buy-to-let’ basis. By this we mean buying a property with the sole intention if immediately renting it out. This could be purely to provide you with regular income from your investment, or it could be that you have bought the property as a long-term investment which has involved taking on a mortgage and the rental income is already earmarked to cover the mortgage payments. The advantage of buying property as an investment is that you can generate an immediate return through rental income, while also creating a long term increase in the value of your investment through the rise in value of the property.

On paper this would all seem like a simple and straightforward way of investing in such a way as to provide you with financial security in the future. However not every private landlord is as successful as they could, and should be, usually as a result of approaching becoming a landlord in the private housing sector lacking sufficient information and experience. There are many pitfalls you can easily avoid, and better to learn the easy way than the hard way!

As a result, we have compiled a short and comprehensive guide on how to be a successful residential property landlord and how to maximise your chances of investing successfully in the UK buy-to-let property market. From choosing the right property to deciding whether to set up your own property company or not, we intend to give you invaluable advice that will help ensure your property investing is as successful as possible.

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What to buy?

Much of your success as a landlord will depend not just on what you actually do once you have bought a property, but on the property you actually decide to buy itself. To this end, it cannot be stressed strongly enough that you need to do a great deal of homework before you buy any property and, most important of all, disengage your head from your heart.

When buying investment property, it is all too easy to fall into the same trap we can when buying a home for ourselves. We are so used to looking at kitchens and bathrooms and if they are not to our taste, we tend not to buy that property. When investing in buy-to-let property, personal taste comes bottom of the list of priorities. Instead, it is all about the bottom line, buying a property that will generate the greatest rental income for the minimum outlay.

We have already covered the buying process in our article Buying a Property to Let, so we will simply touch on what was discussed in greater detail.

  • Do your sums and establish early on what you can afford to pay for a property.
  • If you need to borrow money to buy your investment property, do ‘worst case scenario’ calculations for when interest rates may rise
  • Establish if you are going to do the maintenance yourself or employ tradesmen, this may influence buying a brand new property as opposed to a period one
  • Establish if you are going to let the property yourself or employ a letting agent
  • Buy the right property for the location. Establish which areas of town are popular with students, young executives or families, and target property that will appeal to that specific market
  • If you are looking to becoming a full-time investor, you may wish to consider buying a property that requires upgrading first, then letting it out as opposed to selling it when the work has been finished

Becoming a successful property landlord isn’t just about buying any property and advertising it for rent in the local paper. Careful research will show you what yields you should be aiming for (yield is the net return on capital invested, or in simpler terms, rental income less costs incurred, divided by the value of the property, then expressed as a percentage). Market research will help you establish where there is a shortage of property to let and therefore where you can command premium rents. Clever market research will help you to identify ‘up and coming’ areas where you can sacrifice lower rental income in return for greater growth in the value of the bricks and mortar you have invested in.

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Becoming a Landlord

Anyone who buys a property and subsequently lets it to a third party automatically becomes a landlord. However, there are various types of landlord, and at the very beginning you want to establish which type you want to be, and the financial implications of that choice.

If you want to fully immerse yourself in the world of being a property landlord, you may find it more cost-effective to do all the physical letting of your property yourself, along with the maintenance and upkeep. You may choose to divide the responsibility up between yourself, a letting agent and a managing agent, you may opt to set up your own property investment company to take full advantage of tax benefits, or you may just become an investment partner with someone, taking a dividend but having no overall physical input.

You may be aware that mortgage interest relief has now been reduced to the basic 20% rate of tax, while stamp duty has been raised by 3% across the board for the purchase of second or multiple properties. This has greatly affected the smaller investor with one or two properties, but you may wish to see an accountant or a financial advisor as registering as a company can have considerable tax advantages.

Legally, you are perfectly entitled to let out your own property as a private landlord. You are strongly advised to use the services of a solicitor to set up the tenancy agreement until you are 100% familiar with them. Today the most common form of tenancy agreement is an Assured Shorthold Tenancy Agreement which is usually set up for a period of six months to a year, and can be renewed for the same period of time. From a landlord’s point of view, the tenant can continue under the terms of an assured shorthold tenancy agreement, with the landlord, under Section 21 of the Landlord and Tenant Act, able to issue the tenant with a Section 21 notice of termination of the tenancy agreement giving two months’ notice to quit the property.

If you feel you don’t want to become involved with your tenants and the financial aspect of letting out your property, you can employ a letting agent to find you a tenant, and someone who will oversee the letting of your property throughout the duration of the tenancy agreement. For this, the agent will usually charge a fee in the region of 15% of the monthly rental income, plus VAT%. Now this fee is tax deductible, but with tax relief reduced to 20%, this makes letting more expensive than it used to be. However, a good letting agent is responsible for finding a tenant and managing the property once the tenant is in occupation, so it can be worth the extra cost for extended peace of mind.

Of course if you are thinking big and want to build up an empire of buy-to-let properties, then you will need to seriously consider creating a company for your property dealings. Having access to a substantial sum of money can allow you to buy one property outright, or with only having to provide a 25% deposit if you want to get a mortgage on a buy-to-let property, you can expand your potential empire well beyond one or two properties. Interestingly, one of the loopholes in the new increase in stamp duty is that owners of 15 or more properties are exempt from the stamp duty increase.

Finally, you may just be interested in being a landlord in name only, but have next to nothing to do with the day-to-day running of a property letting business. There are many shrewd investors who choose to back property investors and who will pool resources to buy into major property developments with a view to mass letting blocks of properties to management companies. Similarly, certain property investors will invest more in people than physical bricks and mortar. Crowdfunding has become an increasingly popular way of attracting investment in property, so there is a far greater number of options available to you as a property owner and bona fide landlord. Check out our Guide to being a Landlord article.

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Responsibilities – legal and otherwise - when letting property

Many who become landlords of buy-to-let property do so almost by accident, often letting out their own home while working abroad or elsewhere in the UK for a year or two. However, if you are letting out your home to a tenant, to do this successfully then there are two people you have to inform. The first is your mortgage company if you have a mortgage on the property. Your mortgage company will have lent you money on the basis you would be the occupant of the property being used as security for the loan. Having a tenant in occupation alters the mortgage company’s legal standing with regard to gaining occupancy in the event you default on your loan.

Secondly, and this is one than many first time landlords forget, remember to let your insurance company know that you are letting out your home. You cannot use standard domestic bricks and mortar insurance for property that is let out. Similarly, if you have let the property furnished, you will need to advise the insurance company covering your contents of the change in occupation. In both instances, expect to see a substantial increase in your annual premiums paid.

Other than that, when a tenant takes occupation it is not a dissimilar situation to when you have sold and moved home. You need to advise all the utility companies of the name of the tenant and you need to make it clear in the lease you have set up for the property that the tenant is responsible for all services and taxes liable on the property from the day they take occupation.

As a landlord, in return for rent paid, the tenant has the legal right to expect the property’s main structure to be safely maintained and to be able to enjoy uninterrupted occupation of the dwelling during the agreed period of the tenancy. During that time and as the landlord, you will also be responsible for ensuring that everything supplied with the property remains in perfect working order. The tenant will be responsible for the overall day to day internal condition of the property, but nothing structural or which relates to services. If there is a leaking pipe, it is your responsibility as landlord to have it repaired, not the tenant’s responsibility. If there is a leaking roof, it is the landlord’s responsibility to fix it. If there is gas central heating, it is your legal responsibility to get the gas boiler serviced every year.

In the simplest of terms, being a landlord doesn’t just involve buying a property, finding a tenant and receiving rent, there is appreciably more involved, and you can become as involved as you wish on a personal level.

However, while we are discussing the legal aspects of being a landlord and what would be required of you, there is also the law which exists behind what you are not allowed to do. For a start, you are not allowed to increase the rent during an agreed period for the lease. You are within your rights to increase the rent as much as you wish when the tenancy agreement comes up for renewal, but before that your hands are tied.

Unless the tenant is in agreement, you cannot legally enforce them to vacate the property prior to the ending of the tenancy agreement.

If a tenant falls behind on rental payments, you are legally entitled to serve them with notice to quit the premises. However, if the tenant refuses, legally you are not allowed to evict them from your property, which also included changing the locks when they are not present. Believe it or not, if you do that, you will be charged with breaking and entering, even though you own the property.

If your tenant falls behind on rent, you have to apply for an eviction notice through the courts, and the tenants can only be evicted by court-appointed bailiffs if they refuse to vacate the premises of their own volition. This is the down side of being a landlord, and cases of non-payment of rent are not uncommon. Invariably, by the time you get vacant possession of your property the inside will have been left in a dreadful condition, and on top of losing out on rental income for anything up to a year, the security deposit paid be the tenant will only cover one tenth of the cost of making good the inside of the property.

Of course you can always insure yourself against non-payment of rent by a tenant, and this can prove to be extremely beneficial for those who require the rental income from their let property to pay the mortgage. Such insurance policies will also cover you for legal costs involved in evicting a tenant and are remarkably affordable.

As an example, Rentguard offer up to £2,500 a month cover and up to £15,000 of legal expenses and the premium is only £99.00 per annum.

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Establishing Yourself as a Landlord

It may be that as a landlord, you choose only to have one buy-to-let property in your portfolio, a type of pension fund that relies on a tenant paying rent to pay the mortgage you have on the property, while over a twenty-year period they will ideally see the property more than double in value. After five years you may see the rent covers more than the mortgage, but with the passing of time comes additional maintenance costs. A successful buy-to-let investment is one which pays for itself with regard to immediate returns, but which increases in capital value year on year.

Of course there is also the often overlooked option of the HMO, or house of multiple occupancy. Where a traditional flat may see you achieve a yield of say 6%, an HMO is capable of returning around 9%. However, HMOs are maintenance-heavy investments, not just from a financial aspect, but also from a time management angle. Usually HMOs require additional and continual maintenance, rent payment can be sporadic, and tenants can be troublesome, but the higher rent paid as individual occupants compensates for the additional input required.

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Conclusion

Deciding to rent out property isn’t for everyone. Certainly substantial sums of money are involved, and this can make some of you feel uncomfortable. However, unlike investing in stocks and shares, while the value of your investment in property can go down, in the long term property is not renowned for losing its value completely. On the contrary, as a long-term investment, there have been few better options than property and certainly where the near future is concerned, that does not look like it will be changing anytime soon.

Ultimately, one of the greatest secrets to succeeding in renting out property is to talk to those who are in the know, those who have walked along this path before you. As human nature would have it, we all like to talk about how we have succeeded, and successful property landlords are no different.

Where renting property is concerned, never rush anything. Do your research and do your homework. Knowledge is a powerful thing, and where property is concerned, you cannot have too much knowledge. Talk to estate agents to learn about the best areas to buy property. Talk to letting agents to discover what property achieves the highest yields and which properties let most easily. To be a successful landlord you need to know your local market like the back of your hand.

And don’t forget to look forward, to plan ahead. As an example, check with the local planning authority what plans there are for future development where you live or where you want to invest in buy-to-let property. Discovering that there are plans to build a new university in an area of a city is your signal to invest in accommodation that would be suitable for renting out to students. As an example, the buy-to-let property market is likely to become very buoyant in Hereford now that plans for the new university have been given the go ahead. Being a successful landlord doesn’t mean concentrating only on the here and now, it is investments for the future that could well prove to be your most successful as a landlord.

What does being a landlord entail?

If you’re interested in becoming a landlord and letting out a property then this article will tell you a little about what you can expect. We talk about what it means to be a landlord and your responsibilities. While being a landlord can be a great money maker and many people run a business as full-time landlords, there are also a lot of downsides too. When you’re ready to take the next step, check out our guide “How to rent out your property”.

Landlord Guide

Landlord

If you rent out any of your property then you’re classed as a landlord, which then means you have certain responsibilities. Those responsibilities include:

  • Making sure all your rented properties are safe and have no health hazards.

You may need to have an HHSRS (Housing Health and Safety Rating System) inspection of your property to make sure there are no hazards; this will be because either the council has done surveys of similar local properties and believes yours may be a hazard, or your tenant has requested one. If a problem is found from one of the 29 health and safety areas they investigate they will either:

If a problem is found from one of the 29 health and safety areas they investigate they will either:

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Issue you an improvement notice in which you will have to make amends

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Fix the hazard themselves and then bill you for the work (can be very costly)

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Stop you or any tenants from using the property

As long as your property is structurally safe and has been maintained regularly, including having the gas boiler serviced if you have one, then all should be fine.

  • Making sure all electrical and gas (if connected) services and equipment are all safe and maintained.
  • You must follow fire safety regulations with the installation of smoke and carbon dioxide detectors
  • Provide an energy performance certificate

You must also consider as a landlord whether you want to manage the property yourself or if you want an agency to handle the management of it for you. Not only can an agency/letting agent find you a tenant but they can also oversee them for you. The fee for this service is normally a percentage of the rental income each month and varies from around 8%–12%.

Personally we recommend managing it yourself, however it is your choice and that is often governed by personal circumstances.

Financial Responsibilities

You are legally required to protect your tenants’ deposit by placing it in a government approved scheme. You have no right to retain the security deposit that is lodged against any damage to the property or non-payment of rent if the tenant has met all their obligations and the ‘damage’ to the property is no more than you would expect from general wear and tear.

With the rental income, you will have to declare it. Like any business you will have to pay tax on your income minus any expenses. For this you will need to register as a sole trader and take a self-assessment test, check out our guide “How to set yourself up as self-employed”. You need to report income for rental over £2,500. If it is less than that amount then get in touch with the Self-Assessment Helpline. See our guide on claiming tax back on a rented property. If you have a mortgage on the property and if it is not a buy-to-let-mortgage you are meant to notify your lender. They are not obliged to grant consent for your property to be let out. If they do consent to it, they could load the interest rate or require an alternative mortgage deal to be taken out. If you have not yet applied for a mortgage we’d recommend knowing what their policy is if you are considering buying a property and moving in for a while before letting it out. You could always consider switching your mortgage to a buy-to-let one. However, there are people who let their property out without telling the lender which keeps the mortgage interest rate lower. If you decide to do this then just make sure your insurance is all in order too – you need to advise your insurance company which covers the building and contents that a tenant will be in occupation.

If you let your property and don’t tell your lender as we’re sure many people don’t, you could find yourself in a difficult position if your mortgagor finds out. The result may result in paying significant charges for breach of contract. Also if your insurance is just for private residential purposes and not a specific tenanted building insurance the insurer may refuse to pay out if your property burns down, etc. But if you keep up the payments every month what is the likeliness of them finding out? Well that’s up to you to decide.

Repairs and Maintenance

Just like the points above state that you must keep your property safe and make sure all electrical and gas services and equipment are maintained you will also have to carry out any repairs and keep the property well maintained so that everything is complies such as:

  • the structure of your property
  • basins, sinks, baths and other sanitary fittings
  • heating and hot water systems

If you decide to rent your property through an agency they will take of all this for you through regular checks. However if there is a problem the agency will still notify you. If you ask the agency to fix the issue they will then bill you whatever it costs. If you refuse to carry out a repair on your property, tenants have the following options available to them:

  • Start a claim through the small claims court for repairs under £5,000
  • Carry out the repair themselves and deduct the cost from the rent.
  • Ask the council to carry out an HHSRS inspection and they can take any subsequent enforcement action necessary.

If you are taking on major repairs because the property is deemed unfit to live in, you can ask the tenant to move out. Before this you need to agree in writing:

  • How long the repairs will last for
  • The tenant’s right to return
  • Details of any alternative accommodation

You can’t repossess a property to do repairs. However if they are major you can apply to the courts for your tenants to vacate the premises or end the tenancy. If you provide alternative accommodation they will be more likely to accept. If you carry out repairs while the tenant is still living there they may be able to claim a reduction on their rent, known as a “rent abatement”. This will depend on what repairs you are doing and how much of the property is unusable. After you have made the repairs or improvement, if there are substantial improvements you have the right to increase the rent depending on the current tenancy agreement.

Rental Pricing

Your tenancy agreement should include how and when you will review the rent. If your tenant has a fixed-term tenancy agreement, for instance 6 months, you can’t increase the rent during that 6 month period unless your tenant agrees. If you’re on a month by month rolling contract with your tenant, then you can increase the rent at the end of any month if you give one month’s notice of an impending increase in rent required. However, you can’t normally increase the rent more than once a year. Any rent increase must be fair when comparing to the average local rents. You can increase your rent by:

  • Renewing the tenancy agreement but with an increased rent
  • Producing a written document for you and your tenant to sign regarding the increase in rent
  • Use a Tenancy Form 4B as a notice proposing a new rent via the .Gov website

If the tenant believes the rent to be unfair they can ask an assessment committee to set a fair rent.

Settling Disputes

If you and your tenant have a dispute, then it’s always best to sort it out between yourselves rather than going to court. Some of the ways you can do this is speak to your tenants about the problems and try and work a solution. If they are being unreasonable, try writing a formal letter to the tenant about the dispute and write what you believe needs to be done and why. If you still do not agree then you can either try a mediation service or take your tenants to the small claims court if the problem relating to money is less than £5,000, or £1,000 if it’s about repairs to the property. The small claims court provides a free mediation service which can take place over the phone. In terms of advice about disputes, you can talk to a solicitor, though they may charge a fee for their time.

Overall being a landlord can at times be stressful, however the income it will generate for you will be more than enough to cover that stress. Make sure to check out our guide about “How to rent out your property” as there we show the actual steps that you can take to successfully rent your property out.

MME Team

Selling a property yourself on Rightmove

This guide is for property developers. This only applies to new builds or change of use (Barn conversions etc) They currently don’t accept, for example, a property that has just been renovated.

Recently we got into a discussion with a couple of property developers. They had built a few houses and were just about ready to sell. Each house was estimated to be worth around £450,000. We asked about how they  were intending to sell the properties, who they were going to sell them with mainly and what the percentage was charged by the estate agent for selling a house. They were going to do what they do every time, ask 3-4 estate agents to come out, value the properties and then pick their favourite. Even though they already knew who they were going to pick. Now before we go more into this, if you want to read our guide on how to sell a property before continuing. It talks about the basics, this guide is purely about selling it without a typical estate agent.

1% was the fee charged by the estate agent for the sale of the house. So for the sale of a £450,000 that’s £4,500. 1% doesn’t seem like a lot but when you say £4,500 it does. These days £4,500 is a lot of money for what the estate agent actually does. It’s not like years ago where we didn’t have websites like Rightmove and Zoopla to look on. People used to go into estate agents looking for houses and estate agents would get in touch with them if they had found something that might be of interest. But today it’s not as common to walk into an estate agents, majority will go online and browse, so suddenly the draw of the estate agents contacts isn’t as valuable. Sure there might be the odd person that will still go into an estate agent and leave their details but is it really worth the 1% charge?

Basically what we want is a way to advertise on Rightmove, Zoopla, primelocation and more. If we can get listed on those websites then everything else you can do yourself. You can take the pictures, write a description, floor plans etc. You will most likely know a lot more about the house either you’ve built or just lived in than the estate agent will so showing potential buyers round won’t be a problem. You can even buy or even make a cheap for sale sign to put outside your house. So the question is, how do we get listed on these websites without being an estate agent?

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If we look at the Rightmove website and go to the Advertising on Rightmove section it states, “To advertise UK properties for sale or rent on Rightmove, you’ll need to be an estate agent, lettings agent, or a new homes developer. You’ll also need to meet certain criteria. Get in touch to find out more.” Well we are defiantly not estate agent or letting agent, but could a property developer be classed as a New homes developer? They are brand new buildings but what is the criteria? Well after emailing Rightmove we found out. A quick phone call quickly cleared up what we could do. New homes developer doesn’t just mean these large property companies. A builder with a single house for sale can sell on Rightmove all the way to a large developer selling multiple houses.

2

We booked for the local Rightmove account manager to come out and see us to get an idea on pricing and what Rightmove can offer. We managed to get an appointment the next day. Our account manager was very good, explained everything they offer and went through a presentation to tell you more about Rightmove, It’s all quite interesting really. After all that he showed us the prices packages they offer. Now from what we were told they do two packages, Standard and Gold. To put it simply they charge you per month + vat. They look at each development not each property. So if you have just one house or 5 houses, as long as they are in the same development it will be the same price.

3

They go off the total value of all the properties. If it’s over 2 million then the price is £1195.00 + Vat, if they total below 2 million then the price is halved at £597.50 + Vat. Now that’s per month and you have to sign up to a 6 month contract. If you sell after the first two months it’s our understanding that you can give them notice and cancel after 30 days.

Standard Package: £597.50 +Vat per month (Total below 2 million). £1195.00 +Vat per month (Over 2 million)

For a single property or even a couple of properties below say £500,000 each it probably wouldn’t be worth going with Rightmove direct. It would be if you could sell them in a few months but unless you’re very confident about selling them quick we’d recommend looking else where. It’s perfect for a developer that has maybe 5+ houses, potentially even less but the more properties you have to sell the better off your going to be with it being priced per development and not per property.

So, what happens if you just have the one property to sell? Well you need to check out selling your property with an online estate agent with a fixed fee. There are tons of online estate agents that will list you on Rightmove along with other websites for 12 months starting at £399 + Vat. Take a look at our Online estate agent guide.

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