Being a landlord can be an effective way to generate extra income. It doesn’t take up too much time and yet offers regular income if handled correctly.
Even if you have a change of plans later on, you have property you can sell to gain money back. As such, it has its advantage but it helps to know what you are doing. To this end, here are a few quick tips on being a landlord.
The Right Insurance
Regular home and contents cover is not suitable for landlords – when it comes to the property you’re renting out, you will need specialised Landlord insurance. This is designed to cover anything that happens in a property you own but leave to the mercy of others. In other words, you don’t have direct control over the home as someone else lives in it and this insurance reflects that.
Know Your Tenants
When you start becoming a landlord, get to know any tenants you choose. It’s always good to be friendly at the beginning to establish a healthy working relationship. This way they can approach you when they need to, and you feel more comfortable talking to them should anything arise.
Of course, you should also be very aware of respecting your tenant’s privacy. You’re only legally allowed to come around the property with a notice of at least 24 hours (unless in an emergency) and even then anyone renting a property will not want to constantly see their landlord. In short, establish a healthy relationship, know a little about who you’re renting out too and, for the most part, leave them to it.
Have An Emergency Fund
With any financial plan, having a security fund is always recommended. When it comes to renting property, you should always have a secure amount of money available. This should cover the various costs you might face, from emergency repairs to re-decoration. If you have multiple properties, your savings should reflect that as well.
Also, it’s important to invest effectively when you make any expenses. You probably already know that taking time to invest properly at early stages can save money in the long run, but when you’re a landlord this becomes more important. Such investments will be more tenant-proof and you won’t be dipping into your funds or insurance any time soon.