Six tips to maximise rental income
When it comes to renting property, landlords should look at rental income in the same way they would any business investment – and all successful businesses turn a profit. To increase your rental business profitability, consider the following tips:
1) Empty properties should be avoided
Rather obviously, if you have a rental lying emptying, it is costing you money. Securing reliable tenants for long-term lets can be a good objective. If you’re operating a short-term let, decrease any turnaround time by getting it market ready as soon as each let concludes.
2) Reduce administration costs
When it comes to letting agents, do your homework. Choose agents that offer fixed-fee payments and consider online letting agents, rather than high street alternatives, as they can save you a substantial amount, charging far less than the 10-17% of rental income for traditional agencies.
3) Frequent Inspections
Check your property throughout the tenancy so that you can detect early signs of damage and repair quickly before bigger problems occur. Accidents and general wear and tear happen so have an inventory check in and check out. You can use property inventory software such as https://inventorybase.co.uk/ to help monitor your inventory.
4) Rent review
Regularly check your rent by researching similar properties in your area, by valuation or through a letting agent. Charging too much will deter potentially good tenants, and charging too little will mean you’ll miss out on making a profit. Do this prior to renting out the property, or have a rent review clause, as it is difficult to increase rent after agreements are signed. You need to consider the pros and cons of increasing rent. Would excellent tenants move out, leaving your property vacant if you raise the rent?
5) Keep up to date
Letting legalities are subject to change and it is important to remain protected by keeping informed. Failing to comply with regulations can result in hefty fines so frequently check Government websites to keep up to date. Landlords can also sign up to mailing lists or blogs that are regularly updated with new regulations.
6) Organise tax
Rental income is taxable, but by claiming expenses that are allowed, you can reduce the amount of tax you are required to pay. A good accountant can advise on tax mitigation strategies, ensuring you remain within the law.