I'm aware that as a result of rising property prices across Teddington, and pretty much all of its surrounding areas, local landlords are wondering whether to dip into the market and acquire more property. I often get asked how they should approach this and what they should consider and so I'm giving 10 tips to people who are considering purchasing in Teddington - last blog I gave 1-5, now here's 6-10....
6) Remember you're not living there.
There is always a tendency when buying a property to go for something that feels 'safe'. "If I like it, others will too"! True, but on the reverse side, just because you don't like it doesn't mean it won't rent, and doesn't mean it isn't a good investment. Often the best investments financially are properties that you may not wish to live in yourself, but which deliver an excellent yield. Equally, you're not living there, so don't decorate to personal taste. You may have always wanted a chocolate carpet, but your tenants certainly don't. You may prefer a bath instead of a shower, but again your tenants won't. Successful renting is about appealing to the widest possible market - white, magnolia, and neutral flooring. It's very boring, but people never object to it!
7) Leave some contingency.
Your property is a long term investment, and you must look after it as you do your own house. On many occasions I've seen landlords stretch themselves financially to the limit to buy an investment property, only to react with horror when the heating fails and a plumber needs to visit - at some point the electric shower WILL break, and you WILL need to replace it. In whatever financial calculations you're making, you must leave some contingency for a rainy day. A few weeks ago, I visited a property just off the high street with a landlord where the pipes had broken causing a flood, and about £10k of damage - the landlord had tried to 'save' by not having buildings insurance. The most sensible and successful landlords return to their property between each tenancy and do what's required to make sure the condition is tip top - they are rewarded generally with tenancies that last longer, better rents, and fewer void periods.
8) Haggle.
It is very much a seller’s market in Teddington at the moment. Sales are at a premium with vendors holding out for a price which just 6 months ago would have seemed ridiculous. However, there will always be properties where the vendor simply wants to 'get rid', and is prepared to negotiate on price as a result. Repossessions are a classic example of this and can be a very simple way of picking up a bargain, spending a few thousand on some simple renovations, and getting it tenanted straightaway. When transacting in property, you often make your money on the PURCHASE rather than the SALE. Don't be afraid to make 'cheeky' offers for properties and see what happens.
9) DON'T overpay for a smart property.
What ever the state of the housing market, a property that is well presented will always command a premium over a property that isn't. Don't fall into the trap of paying £10k over the odds for a property that has had a lick of paint costing £1k. You don't want to buy something that is falling down, but a lot of the time, a property that looks pretty dull can be acquired cheaply, and turned into something smart for a reasonable cost - far less than purchasing the house in a finished condition. It's more or less impossible to SELL a property for MORE than it's worth, but it is possible to BUY a property for LESS than it's worth - this is where the canny investor makes his or her money - don't be put off by a property that looks rubbish, but isn't. If you are unsure of what needs doing and what it will cost, ASK US - often our maintenance people will give you a fixed price on completing the works.
10) DON'T skimp on presentation.
It's a fact that well presented properties rent far more quickly than those that are dated or need decoration. Keeping your property smart, clean, neutral, and well decorated might cost you money in the short term, but it will save you money in the long term though higher rents and reduced void periods. If you're renting a property in the medium term (5 years plus) it's never a bad idea to get it perfect at the start, rather than patch up as time goes on.
Finally, I think you'll know by now that I have to end on a piccy - relevant or not! This one I like...just not sure on the relevance! :o)
If you want to be added to our list of landlords who are contacted when a good investment becomes available, let me know at rebecca@rebeccasmithpropertyservices.co.uk.
Rebecca
