Should I manage my rental property myself?04-07-2023 | Other
So, you have bought a new property that you want to let out to tenants to generate some extra income. Perhaps you are expanding your existing property portfolio, or it could be the first time you have bought a second home as a buy–to–let investment. Early on, you need to have a good think about how it could be managed effectively. Should I manage my property myself?
Yes, you can earn a decent income from a well-run buy-to-let property, and it can be a venture that provides you with a handsome yield. But you can also lose a fair bit of cash if it is not managed properly and tenants are left unhappy. If you are the landlord of an HMO (a property with at least 3 tenants from different households) and you mismanage it in a way that is neglectful to the health and safety of tenants, you could have your HMO landlord license revoked by the local authority.
At CIA Landlords, we are experienced in working with our partners to provide landlord insurance solutions that cover any challenges you may face. Here are some pointers to guide you through whether you should manage your rental property yourself.
The responsibility of managing a rental property yourself
You have two options, either managing the property yourself where you have direct communication with the tenants and take care of repairs and maintenance, or hiring an organisation offering a property management service. Some letting agents also provide property management services, but others only help you with finding tenants.
Trying to smoothly manage a rental property by yourself is a significant responsibility.
If you have decided to take on the sole responsibility of managing it yourself and you are a dab hand at DIY, live locally, and have good availability, then it could be an arrangement that works just fine.
When making up your mind on whether to operate as a private landlord or use a property management service, remember the key responsibilities you have as a private landlord such as
- Making sure the property is safe and fit for tenants to live in
- Ensuring health and safety regulations are met throughout the house, including fitting smoke alarms and carbon monoxide alarms
- Respecting that tenants are entitled to the ‘quiet enjoyment of their rental property, you can’t enter the unannounced
- Providing at least 24 hours notice to tenants for a property inspection, a tour of the place to prospective new tenants, or to carry out repairs and maintenance (except in emergencies, such as smelling gas or a house fire)
- Maintaining any areas of the garden or outdoor space that it would be unreasonable to expect tenants to look after, including fences, guttering, trees, and patios
You also need to be mindful of recent changes in legislation relating to landlords with rental properties. The abolition of ‘section 21 notices’ in the Renters Reform Bill 2022-23 means that you now have to provide stronger justifications than before to evict tenants currently living in your rental property.
The benefits of being a private landlord
There are always pros and cons to every decision you make as a buy-to-let landlord. Here we take a look at the benefits of operating a private landlord.
One of the main advantages of being a private landlord is that it can be a way for you to save money and increase your yield. Why so? Well, property management companies and letting agents can charge pretty hefty fees. On average, in the UK you can expect organisations offering full property management to charge a fee of around 10% of your monthly rent.
If you do manage your rental property by yourself, then you are in control and can do everything in your power to keep the costs down. You may even have friends or family who are tradespeople and can help you with property maintenance and repairs for lower prices or as a favour.
Having a property management service or letting agency running your rental property can be stress-inducing and frustrating, particularly if they are not sufficiently attentive to your tenants’ needs. So, being a private landlord can be considerably less hassle.
You have sole control of managing the property
Having a third party responsible for managing your rental property means things can feel out of your control. However, a nice benefit of operating as a private landlord is that you will have sole control over managing it and overseeing everything.
Potential downsides of being a private landlord
On the other hand, there can also be potential negatives of being a private landlord, including things like
- Tenants contacting you frequently for multiple reasons
- Having less free time due to you consistently needing to do repairs and maintenance jobs
- Mediating between tenant-neighbour disputes
- Chasing tenants for rent payments
The benefits of using a full property management service
There are also clear benefits of using a full property management service. Let’s go into these positives a bit more
- The peace of mind of having an organisation to take care of landlord all tasks and responsibilities for you, large and small
- They will ensure your property meets legal requirements for tenants
- Full property management services will have contacts with credible tradespeople to carry out any maintenance or repairs issues that tenants flag up
- Less hassle and pressure on you
Why you need comprehensive landlord insurance through CIA
One thing certain is that you always need to keep yourself covered as a landlord, whether you chose to be a private landlord or use a property management service. At CIA Landlords, we work in partnership with some of the biggest and best names in landlord insurance to provide customers with bespoke packages.
Interested in taking out a landlord insurance policy through us at CIA Landlords? Get in contact with us today to speak to one of our experts and find out all about our fantastic range of landlord insurance offers that will ensure you have the coverage you need. Call us on 01788 818 670 or send an email to firstname.lastname@example.org
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