Property management decisions to make when property investing
Property investing could be your route to wealth, passive income, and a retirement lifestyle that others can only dream about. As a property investor, you’ll need to make a few decisions. For example, what’s better for rental income – new build or existing properties?
One of your key decisions will be whether to manage your properties yourself or hire a professional investment property manager to take on those responsibilities.
In this article, I’ll discuss six of the reasons why I’m not – nor will I ever be – a buy-to-let landlord. I invest in property and let someone else do the day-to-day landlord duties.
I’m not cut out to be a buy-to-let landlord: here’s why
1. I’m not a DIY demon
If you love DIY, you may love being a buy-to-let landlord. Although it’s not quite as easy as you might imagine. There are a few limiters on your ability to make repairs and carry out maintenance work on your buy-to-let property. For example:
- Your time
- Your capabilities
- Your qualifications
If your tenant reports a problem – a water leak, for example – you’ll probably have to work quickly to avoid further expensive damage to your property. If you don’t, you could risk your tenant leaving. It may even be that you are obliged to pay a tenant’s hotel accommodation while you make repairs.
What if the tenant reports a problem while you’re on a family holiday thousands of miles away?
Of course, there are certain works that you cannot do unless you are qualified to do so. And if you do, you could get sued as well as face a hefty fine.
So, you may be able to make simple repairs, a bit of painting and decorating, for example. But for everything else – electrics, gas, water, structural, etc. – unless you’re qualified and can be available 24/7, you’ll need to hire local tradespeople. That could be expensive, and if you don’t hire good tradespeople, you could be screwed anyway.
2. I don’t want the hassle of collecting rent
If you’ve got great tenants, hopefully, they’ll pay the rent on time. But even the best tenants can get caught up in their busy lives and forget to pay. They may not call you to let you know why. Suddenly you become a debt collector.
I hate chasing people for money. Businesses are a different matter. You know where you stand with a business. The phone gets answered, as do emails. Individuals are a whole new ball game. Quite frankly, I don’t have the time or inclination to spend half a day or more chasing up a late rental payment and then repeating the process a few days later.
3. Dealing with a tenant from hell
Only a very small minority of tenants (less than 1%) turn out to be tenants from hell. The majority will treat your property like it’s their own. They’ll pay rent on time. They’ll be good neighbours. But that minute minority could make your life an absolute misery.
Buy-to-let landlords who cut corners to cut costs suffer more than three times the number of nightmare tenants. Buy-to-let experts advise that you should avoid free tenant search sites. When you do find a tenant for your property, you’ll need to make sure that you vet them comprehensively.
Most career bad tenants know that landlords who advertise through free sites neither have the time nor the ability to vet properly. They know these landlords won’t check back with previous landlords or employers, and they won’t run proper credit checks.
As a landlord, you’ve got to have a thick skin and highly developed people skills, as well as the time to deal with tenants who become argumentative, aggressive, cause damage, and don’t pay. This kind of aggravation isn’t what I sign up for when investing in property.
4. Staying on top of the law
Landlord law is in a constant state of flux. New rules and regulations come into play on an almost weekly basis. Governments, local authorities and trade associations love moving the goalposts.
If you need to make an eviction, there’s a set process to follow. Put a foot wrong, and you could be stuck with a non-paying tenant for months. You’ll need to make certain all the I’s are dotted, and the T’s are crossed. And get to court on time.
Staying abreast of the law, and complying with it, is a full-time occupation.
5. Finding and vetting new tenants
One fact of investing in property and buy-to-let is that you will have void periods. When a tenant leaves, you’ll need to get the property ready for renting as fast as possible. Then you need to:
- Market the property
- Show tenants around
- Interview them
- Vet them
- Write an up-to-date and watertight tenancy agreement
That’s a lot of time and cost. Plus you’ll need interviewing skills, legal competence, and know how to dress your property to show it at its best.
6. I don’t have the time to monitor my property and manage my tenants
Finally, you’ll need to manage your tenants and your property. It means regular contact, property inspections, and comparisons against inventories.
Again, you’ll need to know the law and abide by it. For example, to enter your investment property, you need the agreement of your tenant.
To keep your property in a good condition, you’ll need to undertake regular maintenance work (with the agreement of the tenant, of course).
Do you want to be a buy-to-let landlord?
The only reason for property investing is lifestyle.
- I prefer to spend time with my family and friends than visiting my investment properties.
- I want the flexibility to go on holiday where and when I want, without constantly worrying about my tenants.
- I want my rent collected and paid into my account, without chasing halfway around the country to get it out of my tenant’s pocket and into mine.
- I don’t want to spend time, effort and money on getting the qualifications to manage my properties.
I’ve got better things to do with my time and money than investment property management. The more time I save by hiring investment property managers to do all the day-to-day donkey work, the more time I have available to research the best places to invest in property UK. It means I invest better, and make more profit. It’s this profit which more than pays for my properties to be managed professionally.
Before you invest in property, ask yourself if you want to be a buy-to-let landlord or a buy-to-let investor.
Contact one of our team today on +44 (0)207 923 6100, and we’ll help you discover the best property investment opportunities in the best places to invest in property UK.
Live with passion
Brett Alegre-Wood
