Toomey Legal are an established Commercial Property Legal firm and sponsors of the #dodigital for Willow Burn Hospice event. Many thanks to Sue for writing this guest blog for us packed with essential tips for anyone who is already a landlord or those us who would like to be.
1) Get yourself a good lawyer! Having access to and being able to work well with your lawyer is key to everything going smoothly. Toomey Legal have an online portal so that you can check the progress of your matter against key milestones. With a quote generator on our website, our bespoke personal service for clients in the North East you can rest assured we know all about the (approximately 150!) laws affecting Landlords.
But our top tip (and one you may not have expected from us) once you have found a good lawyer, find another one! Let them know you have two lawyers! It keeps us on our toes and allows you a back up at busy times.
2) Join a good Landlord Organisation. Why not have a look at the National Landlord Association? They will be a support to you as well as helping you keep up to date with any changes in the law that could affect you and add a level of credibility to you venture.
3) Be a lazy Landlord! It is in your interests to keep your property in good condition and get the best tenants you can by offering them good terms and great quality. That way you will avoid having to pay re-letting charges as often and will have fewer void periods. This all adds to your bottom line and you don’t need to do as much!
4) Get all of you certificates in place, before you find a tenant. You need to obtain an Energy Performance Certificate (EPC), gas and electric certificates as well as a licence if your property is a House in Multiple Occupation. Failing to obtain necessary certificates can result in a fine and in some cases, imprisonment.
5) Build a quality team of advisors. A good accountant can save you money by showing you how to structure your business or use capital allowances. They are not just there to file your returns! Invest time in getting a good insurance broker, build good relationships with the local agents, your bank manager or financial advisor. Having these people on board will allow you to get the best deals at the best prices.
6) Have a crisis team! What would you do if you were victim of a cyber-attack, or found yourself incapacitated for some time? Would you be able to manage your portfolio? Would your business and properties survive? If the answer to either of these is no, you should consider appointing a Lasting Power of Attorney. That way, there will always be someone to manage your matters when you aren’t able to. Also, get yourself a good litigation lawyer so that you can deal with squatters or bad tenants quickly.
7) Register with the Land Registry’s Property Alert System. This is a free service and can stop you being involved in any fraudulent action. Register now and remember you can register ten properties per email address. You will receive an email as soon as there is any significant action on one of your properties. This includes a pre-completion search as well as an application to register a sale or a mortgage. If you contact the Land registry as soon as you have received this email, they will be able to stop the application proceeding.
8) Managing tenants. If you use a managing agent, choose with care! Some are notoriously slow, expensive and can blight your property. Others can offer you a smooth, stress-free service that deal easily with any problems, and keep damage and voids down to a minimum. Excessive costs of either the agent or the Landlord’s solicitors can mean that you as the Landlord are unreasonably withholding consent to an application for a Licence to Assign, so keep an eye out for what they charge.
9) Money Laundering Regulations. This is especially important if you manage your own tenants. A fourth regulation came into effect on 26th June 2017. There are tough penalties if you get this wrong. Take care in checking the identities of your tenants and of any solicitors involved in managing your properties. Property is a target for fraudsters so be careful. Do not send money to bank accounts whose details you have only received by email. Even if that is your solicitor, do not be afraid to question it. They can all be hacked and if you send your money to the wrong account, you may never get it back.
10) Don’t buy properties that you like or would live in! Personal taste is not a good indication of profit! It is particularly tempting when you buy your first property, it is tempting to buy property that you like. Instead, focus on gaps in the market and where the greatest demand is.
Often it is the basics we forget when we are busy, so always remember these Top Ten Tips and remember we have lots more information on the Toomey Legal website.