Being a Landlord is a business, and the secret to any successful business is to ensure that the income they are yielding is consistent. By having consistent income, a Landlord allows themselves to easily plan for the future as they’ll always have an accurate idea of the monthly income they will receive from their properties.
Here’s a few tips on how a Landlord can make their income consistent
Avoid Unpaid Rent
It seems pretty obvious, but it’s the steps a Landlord takes before the rent is due that actually makes all the difference when it comes to unpaid rent.
Landlords should always make sure that they screen your tenants thoroughly. There are the usual ways, such as requesting a full application and running a background check. However, a Landlord can do this by also asking for a few different things ranging from asking for a previous landlord reference to actually interviewing the tenant and getting a feel for the type of person they are. There are plenty of options to assist in screening potential tenants before a Landlord agrees to rent their property to them but just those mentioned above can make a real difference.
Control Your Expenses
Another way for a Landlord to ensure that their income is consistent is by controlling their outgoings. This not only means being aware of all the outgoings they are responsible for but also ensuring that the outgoings are regular and predictable.
Examples of a Landlords outgoings would be any included utility bills, mortgage repayments, insurance, maintenance and repair costs. A Landlord should ensure that they have it written into the tenancy agreement that there is a cap on any included utilities and an understanding of the type of maintenance they will complete that isn’t the responsibility of the tenant.
However, that list also doesn’t mention the optional outgoings a Landlord may choose to pay such as; joining theLandlord Association to reap the benefits that come with membership such as becoming more attractive and trustworthy to potential tenants. Or the solicitor's fee’s they would need to pay to get their tenancy agreement looked over by a legal professional to ensure it is watertight before they let a potential tenant sign it.
Cover Your Back
Lastly, what could be considered one of the most important ways a Landlord can make their income consistent by making sure they have covered themselves for a worst-case scenario. This includes asking tenants for deposits and a month's rent upfront, but also by asking for a Guarantor.
By asking for a Guarantor then a Landlord is ensuring that they have someone else that is responsible for the rent should the actual tenant fall into arrears. Every tenant is able to provide a Guarantor, even if it not the usual individual friend or family member, as there are companies available. One of these companies Rent Guarantor which allow individuals to make an application irrelevant of whether they receive their income via employment/self-employment, being in receipt of benefits or even if they are a student.
In conclusion, a Landlord should always ensure that they have put measures in place to guarantee consistent income from their rental properties. These are just a few of the main pointers to get them started. However, online there are multiple resources that can help expand the Landlords safety net.
Disclaimer: Rent Guarantor is not qualified to give legal or financial advice. Any information shared in the above blog is an opinion based on personal experiences within the property rental sector, and should never be construed as legal or professional advice.