Ilkeston rents .. ask too much?

For instance in Ilkeston, the sheer number of 2 bed terraced houses on the rental market stops prices moving significantly. If you ask for an extra £50, it's fairly easy for a tenant to find a landlord who doesn't. In Eastwood, the average income of tenants restricts prices - there's no point raising the rent to a level where your tenant can't afford to pay.

 

Some landlords have enjoyed an increase though - houses are generally trading at £25 or £50 per month more than they were a few years ago, which is good. The inherent danger here is that landlords come to expect these levels of rent - just as a few years ago people assumed property prices could only rise, the mistake they will make now is assuming that rents can never fall. They can. And at some point they will.

 

But although I sound negative, there's no reason to be concerned! Just be realistic. The long term demographics of the rental market remain VERY good - a chronic shortage of housing, a growing population, large funds needed to purchase property, etc etc. I chose to open a lettings agency and am a landlord myself which shows that in the medium to long term I think investment property is good place to be. 

 

My advice to all landlords is hence to charge the best rent you can, but fundamentally to AVOID THE VOID. I have one large landlord who for a number of years has insisted that his properties are marketed about 5% under the market value - going against the advice I initially gave him. 

 

However when we look back at his portfolio over a number of years, we see his average void between tenancies is less than 7 days - his properties are hardly EVER empty. 

 

Compare that to the landlord of a property who let it sit empty for 3 months because the previous rent was £700 and he wanted to wait until he was offered that again. He did get it eventually, but he's lost £2100 by the time he did. Had he accepted our advice to market at £650 from day 1, he would have lost a lot less. Incidentally, he doesn't think he lost - he's happy that he won because he got his £700!

 

It's also worth remembering that if we're managing your property, we're on a cut of the rent you receive. As such it's in our interests to charge a tenant as much as we can, as well as yours. Hence if we're recommending not moving a rent, or even dropping it, we usually have a valid reason for suggesting this.

Heanor's least expensive streets

Heanors best prices streets ....

1st Mount Street  £67,719
2nd Weston Street  £70,536
3rd East Nelson St £71,385
4th Stamford Street £72,309
5th Prospect Road £73,967
6th  Loscoe Road  £75,042
7th Northern Road  £76,525
8th Gillott Street £77,521
9th  Ray Street  £78,304
10th  West Street £78,316

Landlords : Don't forget your property is a BUSINESS

I'd say probably half new landlords at the moment are 'accidental' - they haven't bought a property to let, but have ended up with a property that needs letting out. Usually because this is because they can't sell it, but sometimes it's a property they have inherited, or maybe they are going abroad for a couple of years. This can affect the way they think about their property - whereas an investor looks at his property as a business and makes decisions with a 'business' hat on, 'accidental' landlords can struggle to get their head round what's actually going on. Twelve months on, it's not unusual for them to get themselves into trouble, have decided that letting is not for them, or have fallen out with their agent and tenant! Here's how to avoid that happening to you.
 
Emotionally detach yourself. If you love the house you're letting like your own home, don't let it! Sell it, or if it's that great, live in it yourself. The reason for this you're going to be offended by any tenant who has the audacity to move in. They'll do something differently to you do - hang a picture, park the car, fail to weed the flowerbeds, wear their shoes in the house - and because you love the place, this will really irritate you! Renting a property that you're not in love with makes it far easier to look at things objectively.
 
Budget for maintenance. Even though the property will be tenanted, things will still go wrong with it. The electric shower may break, the boiler may leak, the upvc window handles may come loose, etc. Many landlords are astonished when this proves to be the case as they haven't budgeted for anything going wrong. Clearly this is short sighted - at some point the landlord will want to sell that property for decent money, and if he's allowed it to get into a state of disrepair, that isn't going to help his cause.
 
Don't make every decision based on cost.  The classic one here is which lettings agent to use! Given that the investment property is likely to be one of the biggest financial commitments you make in your life, why would you put it in the hands of someone who trades on being 'cheap'. However this also extends to whether you should have an inventory and whether you should insure the rent. Whereas successful landlords realise the value of 'doing things properly', an accidental landlord often tries to cut cost at every opportunity. I'm a lettings agent and I still have rent & legal insurance on every one of my own investment properties, which should be an indication that it's worth the premium. 
 
Should you really self manage? I could probably service my car if I put my mind to it. I'd get away with it for a while, but sooner or later I'd get caught out and a sizeable repair bill would follow. It's the same with playing at property management - type 'landlords forum' into google and you'll find umpteen advice sites for landlords which are littered with questions from people who've got into trouble managing their own property. Most of the issues cover simple things - how to end the tenancy, how to deal with non payment of rent, how to deal with a demanding tenant, etc - but if you don't know the answers, the only real outcome is expensive legal bills. I've took on 4 properties on in 2013 where the landlord had been managing previously, and basically wanted someone to sort out the mess they'd created.
 
Understand that every business has customers that don't pay. Again, whilst statistically your chances of a fundamentally rogue tenant are low, if you let any property out for a period of years, you're going to have hiccups at some point. This is a business, and sometimes tenants (customers) will cause problems - it's occupational hazard. Accidental landlords sometimes forget this and react with horror when everything doesn't go according to plan. Professional landlords realise that the 2 biggest risks of letting a property (tenant doesn't pay, and tenant damages property) are both insurable. As such the income stream is secured.
 
Focus on what really matters. Landlords who have bought to let tend to be results focussed. They look at the big picture - keep the property condition up, keep the property tenanted, keep the income coming in. They worry less about the detail - for instance how the property is described on the agent's website. They don't tell the agent how do its job, but they do expect answers if the results aren't delivered - which is perfectly fair. On the other hand, I do have accidental landlords who lecture my staff in the n'th detail on how to let and manage properties, which invariably only serves to make things more complicated. If you don't have faith in your  agent to look after the property, you've chosen the wrong agent(!) And if you desire an agent who simply says yes to every question you raise, you're storing up problems for the future.

Heanor's most expensive streets

Thought you might like to know the most expensive streets in Heanor, with the average value of a property on that street ....

1st  School Woods Close   £534,121

2nd  Lower Maples   £360,618

3rd  The Field   £313,965

4th Castle Court  £254,118

5th  Twyford Close  £249,429

6th  Highfield Close  £238,771

7th  Birchfield Park  £236,707

8th  Kings Close  £231,402

9th  Sycamore Gardens  £231,169

10th  Grange Gardens  £228,322

More towns to follow, including the cheapest streets as well