Parents considering beoming landlords

Marktheshark

The profit margin is small, at 12% the agents will be making the money and your parents paying the bills.
It sounds simple, but for them to take a 12% cut there has to be profit to take it from.
What investments do you know that takes 12% a year profit.
For the letting agents its money for old rope and often they let anyone in, their fees are contracted water tight, rent paid or not.
That extra 12% is the profit margin.
If they can not run the business themselves without giving someone their profit each month then letting is not for them.

ognum

Marktheshark wrote: »

The profit margin is small, at 12% the agents will be making the money and your parents paying the bills.
It sounds simple, but for them to take a 12% cut there has to be profit to take it from.
What investments do you know that takes 12% a year profit.
For the letting agents its money for old rope and often they let anyone in, their fees are contracted water tight, rent paid or not.
That extra 12% is the profit margin.
If they can not run the business themselves without giving someone their profit each month then letting is not for them.

Letting agent fees are a tax deductible expense so actually reduce you tax liability rather than you profit.

Of course you have to have a tax liability for this to work but in my case it reduces my payment to the tax man!

domcastro

I went with a agency and wish I hadn't. Even though they visited every 3 months, their standards were far lower than mine! For example, in the report, the agents wrote "scuffs on some paintwork". In reality, the tenants had painted the whole house badly and every carpet had paint all over it. The house also stunk of dog and wee. In 2 reports, the agents had written "dog in garden, tenant says he's dog sitting". In reality, they had 2 dogs and a male unneutered cat who peed everywhere - I've had to buy special urine neutraliser. Then the tenant stopped paying rent and all the agents said was"Bet you wish you had taken our insurance now". Then the agents tried to get money out of me to make up for not getting rent. I badly fell out with them and then when I sorted the whole situation without their help, they said I had to take them to Small Courts to get the deposit back!! Cheeky. I rang MyDeposits and they told me the rules. I went to the agent's head office, and they then gave the permission to release the deposit to me (the tenant had told them I could have it but the agents were trying to get it all to make up for no earnings whilst the tenant wasn't paying rent)

I would never use an agent again. They were a waste of time and my house is a wreck.

domcastro

PS. My friend's a landlord and she uses agents just to get the tenants. Nothing else

p00hsticks

hawkeye9999 wrote: »

Come home tonight to a message from my parents, that a house opposite is up for Sale as it's been repossessed and they are seriously thinking about purchasing and renting out.

If they really want to get into BTL, they should be asking what is the most suitable type of property to buy and in what location - chances are it won't be this one

jjlandlord

Pixie5740 wrote: »

I wouldn't like to live across the road from my landlord. Too much temptation for them to spy and interfere.

You are confusing with a psycho...

ognum wrote: »

Letting agent fees are a tax deductible expense so actually reduce you tax liability rather than you profit.

Erm, it will reduce profit...

G_M

Letting Agents (Tips for selecting, and tips for sacking them)



New Landlords (information for new or prospective landlords)