Landlords have had a pretty rough time of it over the last year or so. Changes to regulations and taxation rules have put the media in a spin, which has created a somewhat negative attitude towards the buy-to-let market.
This, in turn, has caused many to question their position, but are the days of successful small landlords really numbered? Is it now all about the big boys and limited companies? We don’t think so, but you do have to be a lot smarter in order to make things work these days.
One key area all landlords would do well to concentrate on is the yields they receive from their property investments. This sounds like an obvious statement, but it’s something that is often overlooked. In this post, we’ll give you five ways of potentially upping that all important number.
Review your outgoings
Let’s start off with a simple one. Regularly reviewing your outgoings can make a big difference to what’s coming in. Do not settle for renewal quotes on things such as buildings insurance, shop around for the best deal available. It’s amazing just how much money this can save you over the course of a year.
Mortgages are probably the biggest outgoing you’ll have as a landlord, so these require extra attention. The mortgage market is extremely fluid and there are numerous new deals and products coming online all the time. Keeping an eye on what’s available and switching whenever you can to something more inline with your current needs can result in substantial savings, so be sure to consult your broker regularly.
Make the right refurbishments
As times change, so do people’s needs. Staying on top of what tenants actually want from a property can make your rental more attractive and allow you to ask for more money as well. Years ago, it was all about decorative features, but nowadays things have become a lot more practical. Sure, your property should still look great, but there are now lots of other ways to attract tenants who are willing to pay a little more.
Consider things such as the rise in remote working, for example. Ensuring that your property has high speed Internet access and a designated space for working could increase your yield significantly.
Another thing to consider is greenifying your rental. Making a property more eco-friendly can differentiate you from your competitors and justify a higher rental charge. A well-thought-out green makeover can be a big draw, both for the environmentally conscious and those who simply want to reduce their energy outgoings each month.
Convert or extend
While this will obviously take a significant upfront investment, extending or converting your property can be one of the most lucrative changes you’ll ever make. Extra bedrooms can bring in more rent, but they’ll also add value to the property as a whole as well, so you’ll be winning on both fronts.
More bedrooms also means more choice when it comes to selecting the appropriate tenants for your rental. Remember, in today’s climate, finding tenants isn’t a problem, but finding the right tenants is becoming increasingly difficult. Opening up your options to the largest pool of prospective renters possible affords you control over who you let to, which often means both more money and less aggravation. What’s not to like about that?
Improve storage
People are increasingly taking on rental properties for longer periods of time, so things like storage space become more sought after by tenants. The good news is that simple fixes can make a huge difference when it comes to improving the storage space found within a rental.
If the bathroom doesn’t have a cabinet, consider putting one up. If your main storage cupboard has only a few shelves and loads of dead space, think about adding some kind of organiser to make use of the wasted areas. Similarly, kitchen storage can be drastically improved upon, too.
Just putting a little extra thought into simple things such as this can make a big difference when it comes to making your property stand out from the crowd. Again, it’s all about getting the right tenant, and the right tenant is usually willing to pay more for the property they set their heart on.
Be flexible
As we touched upon above, tenants are increasingly in rented accommodation for the long haul these days, so being a little more flexible than your competitors can increase your yield considerably. What kind of flexibility are we talking about? Well, things such as allowing your tenants to make minor alterations - decorating, for instance - or keeping pets can make big difference.
As one would expect, landlords offering these sort of perks are few and far between, which means that you can command a premium if you buck the trend. Assessing the pros and cons of each differentiating factor will give you a better idea of which ones will suit you best as a landlord. Of course, the more you can offer, the larger your prospective tenant pool will be.
That’s it, five ways in which you can increase your rental yield and push your portfolio further into the black. If you need any further advice on letting your property in Wanstead, Buckhurst Hill, or any of their surrounding areas, give our dedicated lettings team a call on 020 8989 2091.
