It is inevitable that as a new landlord you may make some mistakes as you venture into your new career. Here are five common ones that landlords make, and how best to avoid them.
1. Not Protecting the Tenant’s Deposit
Forgetting to protect your tenant’s deposit is an easy mistake to make but can be extremely expensive. Under the Housing Act of 2004, each deposit in the UK must be protected within one of the three government schemes. This must be completed within 30 days and Prescribed Information must be issued. If you forget or it is not completed properly, you will be ordered to pay three times the deposit to the tenant in compensation.
2. Not Purchasing Landlord Insurance
If an accident takes place on your property, this can be costly if no landlord insurance is in place. Normal home insurance is inadequate for rental accommodation. A specific insurance policy for landlords is required and includes extras such as public liability insurance for accidents.
Landlord insurance need not cost a fortune – for cheap landlords insurance talk to companies such as https://brokersdirect.co.uk/.
3. Too Many Decorative Touches
Many landlords tend to treat their rental properties like their own homes and lavish money on expensive fittings and fixtures, artwork and furnishings. Not only is it a waste of money and much-needed profit, but it may put potential tenants off – they will prefer a more neutral empty space to work with and make their own.
4. Becoming Too Close to Tenants
Many landlords fall into the trap of becoming too friendly with their tenants and almost becoming new best friends! This can prove difficult if they need to get tough when problems with tenants occur. We all hate chasing a friend for money – imagine chasing a tenant for rent if you have become too friendly.
It is best to be polite and friendly, but keep it strictly professional.
5. Not Conducting Regular Inspections
Once your new tenants are settled and paying rent regularly on time, it may be tempting to think your job is complete. However, it pays to keep an eye on your investment.
There are plenty of scary stories, and routine inspections reassure you that your investment is safe. Carry out an inspection every six months.