Making the property habitable
It is the landlord’s responsibility to ensure the property is in good condition before tenants move in, so expect to have to invest time and money into carrying out some maintenance work both before, during and between lets. Cleaning, decorating and repairs may be required so having a contingency fund will allow you to carry out work quickly, to help minimise void periods.
Minimising void periods
Void periods are when your property has no tenant – and you have to pay all the costs yourself, including mortgage and utility bills. Void periods turn an income-generating property into one that costs you money so, while they cannot be avoided completely, they should be minimised as much as possible and you should have a contingency plan in place.
Here are some tips for minimising void periods:
Be willing to accept a lower rent
One of the biggest mistakes landlords make is to hold out for an unrealistically high rent, which can result in their property standing empty, sometimes for months at a time.
In almost every case, accepting a lower rent is a wiser move, as the tenant will be contributing towards your costs, even if they don’t cover them completely.
Monthly costs = £500
Property stands empty for two months = a loss of £1,000
Property rented for six months at reduced rate of £450 per month = a loss of £300
Make your property attractive to tenants
A few hundred pounds spent doing up a property to make it attractive will make it stand out from the crowd and easier to let, possibly at a slightly higher rent. This is a worthwhile investment if it avoids your property standing empty and costing you money.
Ideally, you should keep a minimum of three months’ mortgage payments in reserve to cover any void periods, emergency maintenance and increased costs.
“With our wide database of potential tenants, we can help you minimise void periods – but we would still advise you have a contingency fund for a rainy day.”