Of course, the first question you need to ask yourself is whether you want to rent out your property or sell it for a profit. If you have decided to rent out your property, there are a lot of important things that you need to keep in mind. For one, renting out a property comes with its pros and cons. You can make money by renting out your property, which is a big pro, but it also comes with a whole lot of responsibility, maintenance and upkeep. Before you start getting in touch with Marylebone letting agents, here are the 5 questions you need to ask yourself before renting out your property.
1 Am I ready to become a landlord?
Becoming a landlord is no easy task. Firstly, in order to get your property rented out, you need your property to stand out. That means installing energy-efficient appliances, choosing modern interiors and ensuring the property is always nice, clean and comfortable. Then, you need to screen multiple tenants in order to find the right tenant. After all, you do not want to get stuck with a tenant who does not pay the rent on time. Despite a thorough screening process, you might have to keep reminding your tenant to pay the rent and be prepared for delayed rent payments – a common occurrence in the rental market. Lastly, owning a rental property is like owning a business. You need to keep putting capital back into the property, you need to treat your rental property as a business and you need to work towards improving your rental property to make it stand out. So, are you really ready to become a landlord?
2 Will I earn a profit by renting out my property?
First and foremost, you need to figure out whether or not you will make a profit when you give out your property on rent. For example, if the monthly rental that you can earn from your property is £2000, then your monthly expenses should not cross that amount. This needs to include the monthly mortgage (if the property is not paid off yet) as well as the monthly maintenance, the property taxes and so on. If you are a first-time landlord who needs some help with property management, get in touch with London block management and estate management agents today.
3 Is the return on investment good?
When it comes to rental properties, most letting agents in Knightsbridge recommended following the 1 per cent rule of thumb. According to the 1 per cent rule of thumb, an investor should not make less than 1 per cent of the total value of the property as the monthly rental. In this case, the total value of the property includes the purchase price as well as any additional costs. So, does the average rental in the area cover 1 per cent of your total cost? If so, the return on investment is definitely going to be worth your while.
4 Who do I want to rent to?
his is a very important question for property owners, and it depends mainly on the location of the property. If you own a property in the city centre but you refuse to accept professionals or students as your tenants, your property might go vacant most of the time. Similarly, if you’ve got a three-bedroom home in the suburbs but you only want to rent it out to corporate employees, you might have a hard time finding tenants for every room! Understand your target market, see who you will be willing to rent to and then make a decision accordingly.
5 Why do I need to rent out my property?
Say, you invested in a property many years ago which has just been sitting idle. The value has not appreciated too much in the last few years, so putting it out on rent is a good way to earn some money on an otherwise vacant property. On the other hand, if you’re putting your property on rent in order to collect money for a downpayment to buy a new property, it might be better to sell the property and use the profit as the down payment. At the end of the day, you need to ask yourself the reason to put your property on rent.