In our experience, being a residential BTL (buy to let) landlord has a fairly simple life-cycle of 4 distinct stages.
The acquisition stage is where the landlord is building their property portfolio. It is important to build a sustainable business with strong foundations that focuses on cash flow, rather than capital growth.
Finding high areas of tenant demand is the most important part of the research process, as well as having clear goals, and a long term view.
It is also important to have a clear strategy of how you will “exit” your investments when the time comes, as this will determine the type of properties that you decide to invest in.
Remember that you may be in a business relationship with an investment property for 25 years, so it’s important to invest time in understanding the correct strategy for you and acquiring the right kind of properties that will help you achieve your financial goals.
Once a property portfolio is up and running, in order for it to remain profitable, it has to be managed effectively. This means undertaking a comprehensive maintenance plan, a refurb or facelift every 5 to 10 years, and undertaking repairs promptly, which you are obliged to do for your tenants anyway.
Undertaking repairs promptly also ensures that small issues do not become large/more expensive issues. A water leak, for instance, can create many thousands of pounds of damage if it is not dealt with immediately.
Maintaining your property is vital to help it keep its value and also remain competitive in the rental market, achieving top rents.
Once the acquisition stage is completed, the consolidation stage comes into play along with No. 2. This means systemising the business, and making sure you understand your financial position. Things may have changed since you started investing, and its important to re-evaluate and fine tune what you are doing and make sure you keep your investment goals on track.
It’s easy to get diverted from your original plan and there may be many changes along the way, such as interest rate rises, so it’s important to understand your options to keep on track.
When a landlord is ready to end their property investment career, it becomes time to dispose of their properties and sell them. It may be prompted by changes in the market, a 25 year mortgage coming to an end, or other factors. The main thing is to prepare well in advance for disposal as there will be tax implications that need to be addressed, and we recommend that professional tax advice should be sought.
Here at Northwood, we can support you through all stages of this life cycle.
During the Acquisition stage, our local offices can advise on tenant demand, and you may even consider purchasing a property with tenants in situ.
Find our list of properties suitable for investment >>> here.
During the Management and Consolidation stages, we can manage your properties on your behalf, taking away the strain. You can also use our on-line property management software to track your portfolio.
Compare our various levels of service >>> here.
You may even opt for our Guaranteed Rent service to transfer the financial risk from yourself to us.
During the Exit phase, Northwood can assist you in selling your investment properties and achieving a premium price for them.
We recently received a testimonial from a landlord who had been through the entire cycle with us.
Mrs Harwood wrote this about our Basingstoke office, giving them a 5 out of 5 review:
“I would highly recommend using Northwood in Basingstoke.
I have dealt with them for the last couple of years since they started renting out my property for me. They were always at the other end of the phone if I had a question and they constantly kept me up to date with progress their end.
In May this year I decided to sell my property and the team sold it within the week. If ever I go down the rental route again I would not hesitate in using them again”.
So, in summary, Northwood can be your partner throughout the entire life cycle of being a landlord. We actively seek to create long term relationships with our landlords, supporting them every step of the way.
*DOWNLOAD Northwood’s free guide: How to find a professional letting agent*
Northwood is one of the largest and most recognised lettings agents in the U.K. and the leading supplier of Guaranteed Rent to give landlords complete peace of mind.
Find us on Twitter @northwoodUK or visit our YouTube Channel.