If you were to speak to any newcomer to the buy to let property industry, chances are they will be able to reel off an extensive list of things they wish they had known before getting started. It’s pretty much the same kind of thing you’ll find with most contemporary industries – especially those where the individuals concerned are self-employed. Going it alone is very different than having the security of being employed.
To say that knowledge is power would be an understatement, albeit a cliché one, as the simple fact of the matter is that making it up as you go along isn’t exactly a good idea. On the plus side, it isn’t necessary in any instance to adopt something of a trial and error approach as there is so much advice and assistance out there to ensure things go as planned from day one. Nevertheless, it’s advice and guidance that some do anything to completely ignore or overlook, summarily finding themselves hitting a brick wall, sooner rather than later.
So just to illustrate the kinds of things that really should be taken into account before getting started, here’s a quick rundown of a few things every prospective landlord will probably admit they wish they had known ahead of time:
To overlook the importance of carefully researching taxation ahead of time is to learn the hard way that landlord taxation can be both extensive and complicated. By completely miscalculating things, or failing to do any sensible calculations whatsoever, so many rental property owners will find themselves either breaking even during their first couple of years or even making a loss. Depending on how many properties you have, the value of the properties and your general circumstances across the board, you could find your property taxation liability exploding. But at the same time, careful research and strategic planning can also help ensure that you only ever pay the absolute minimum required tax. If in any way unsure, expert advice should be considered mandatory.
There are so many convoluted duties and responsibilities when it comes to managing properties that it simply makes sense to seek essential assistance when and where possible. These days, rather than hiring a human employee to take care of all manner of administrative tasks and daily operations, property manager software can take care of things on your behalf. And of course, the fact that you don’t have to pay computer software a regular wage or worry about things like annual leave makes it an entirely common sense consideration. There are so many menial jobs that can be taken over in their entirety by computers these days – software really can make an enormous difference.
So the good news is that in 99 percent of cases, the hideous horror stories you have heard about tenants completely and totally destroying properties do not represent realistic scenarios that you yourself will face. That being said, however, most newcomers to the industry are entirely unprepared for just how much inevitable ‘wear and tear’ can be inflicted on their properties over the course of the months/years. Roughly translated, when the time comes for one set of tenants to leave and a new set to move in, you might want to brace yourself for the kind of maintenance bill that will probably be considerably higher than you expected.
Still on the subject of tenants, every successful landlord the world over will tell you in a heartbeat that there is absolutely nothing more important than quality tenants. To find the very best tenants means to agree on the very best price for your property, ensure that your property’s contents are looked after, never have to worry about late rental payments and so on and so forth. As such, even if it means taking considerably longer than you expected to find the right tenants, this is time and effort that could not be better invested.
Last but not least, one of the most important golden rules of all when it comes to success is to get into the mindset whereby you consistently hope for the best but expect the worst. The reason being that when it comes to maintenance, repairs and outright emergencies, you have absolutely no idea when and where they will occur and therefore have to be prepared for them at all times.