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5 Buy To Let Mistakes to Avoid

Treat it right, follow the buy to let rules,  run a conservative strategy and owning a but to let rental property can be a relatively hassle free, low risk and profitable investment. I’ve been a property landlord for about 11 years now so I’d like to think I’m speaking from experience on the subject.

As the popularity of buy to let has increased I’ve encountered more and more people dabbling their toes in the landlord game. Below are a some of classic mistakes I’ve seen new landlords make.

1. Be an Ass Hole Landlord

I work for an investment bank AND I’m a landlord so I must be a grade A ass hole right? Well hopefully that’s not the case.Rigsby - The Miserly Landlord

Look after your tenants and they’ll (usually) look after your property. Stay on top of repairs, don’t always cheap out on appliances, never ignore your tenants requests/complaints and you stand a much better chance of your tenants being house proud and looking after the place.

Piss them off and they’ll likely move on, wreck the place and leave you with the costs of finding new tenants, inventories, cleaning, vacant periods etc.

Think of it this way:

Your tenants and you are in business together. It’s in both your interests for the house to be functional and well kept. Bear this in mind when problems arise and negotiate outcomes where both parties win.

2. Be Cheap

I’m a big believer in in the maxim buy cheap buy twice. When it comes to buying things like carpets or white goods for a rental property I believe the cheapest option isn’t always best. Buy things that will last. If you provide good quality fixtures and fittings your tenants are far more likely to look after them well and the higher quality should last longer anyway.

3. Be Expensive

Another common mistake I see landlords making is getting too emotionally involved in their properties. This is usually even more of a problem when the landlord used to live in the property.

I witnessed a friend renovate a rental property a couple of years ago and lose all control of the budget. The planned spend for the renovation was about £4,000 however the final figure spent was about £18,000. The extra rent he achieved from the ‘top spec’ fit out was £20 per month. It’ll therefore be a while until that extra £14,000 pays for itself.

Keep things simple, functional, neutral and hard wearing. Here are a few examples of how I do this:

  • Avoid expensive carpet bills every 3 years by stripping, sanding and varnishing the floor boards
  • Choose neutral colours (white) for kitchen/bathrooms so minor repairs/upgrades can be made without redoing the whole room
  • Avoid letting properties fully furnished. Not only will you’save the hassle and expense of replacing furniture, you’ll probably attract tenants intent on staying longer
  • Avoid ‘on trend’ decoration that will potentially look dated in 3 years time. Instead go for classic looks that don’t date. Everyone likes white washed walls.

4. Hurting when expenses roll in

I have a friend that rents his old house out. Every time I meet him he never stops complaining about the expenses he’s encountering. He worries himself sick about the bills that come his way and feels like he’s being robbed by tradesmen the whole time.

Too many new landlords think renting a property is a license to make profit. Move the tenants in, sit back and count the rent cheques. Wrong.

You might not get any bills for a few months, but when the roof needs some repair work or the place needs repainting you’re going to get a large bill.

As a general rule I assume maintenance costs will be roughly equal to two months of rent each year. Save it, expect it and when the bill comes, pay it out with a smile on your face knowing that it is going towards protecting your capital that provides you with that reliable, inflation proof income every month.

 5. Choose the Wrong Tenants

It is well worth spending time and money finding good tenants. When your property is empty don’t be tempted to sign up the first people that say they want the place. Always take the time to meet prospective tenants and don’t just believe any agents judgements about character. By meeting your tenants both parties are more likely to respect each other. You won’t just be a landlord on the end of an infrequently checked email address.

Once you’ve found some prospective tenants spend some money and get some proper references from an agency. They will check their credit history, verify their income and confirm their previous landlords opinion. This is a key part of the process so don’t be tempted to save yourself £200 and skip it.

One of my current tenants has a blemished credit history and ‘sub optimal’ employment status (self employed with limited financial history). However by meeting her in person I got to judge her character and hear her reasons/story behind her work and credit history. Having been satisfied with what she told me, she moved in and is now 2 years into a hassle free tenancy. To date has been a pleasure to deal with. The lesson is to use both quantitative and qualitative measure to screen potential tenants.

{ 9 comments… add one }
  • Nibbler October 10, 2014, 12:44 pm

    Interesting post and some good advice. There’s no doubt that keeping a property to a good standard is key to keeping good tenants and also encouraging said tenants to keep that standard going until they leave.

    I like that you meet prospective tennants even when an egent is involved, I’ll try this on the next change of tennants.

    I was suprised too by the long and varied list of expenses and this can be a source of serious worry if margins are tight. Throw in the occasional re-mortgage with associated fees every 5 years or so too!

    One of the biggest issues I have found is finding and keeping good tradesmen. Very few are intertesed in small jobs. I’ve wasted a lot of time meeting tradesmen who visit, quote and then are never heard from again. We pay for full management (which many landlords would probably consider wasteful) but it’s proved it’s worth simply because the agents are able to call on their trade contacts and quickly get our small repair work done. They must provide the scale of work that keeps the tradesmen’s interest.

    Out of interest what’s your view on pets?

    • Under The Money Tree October 10, 2014, 1:04 pm


      I’m glad you found the post of interest.

      Tradesmen – I fully agree. Good, reliable tradesmen are worth their weight in gold. I’ve been blessed in the past by hooking up with a couple of semi retired builders (thats the profile i look for). Both were incredibly knowledgable, multi-skilled and preferred smaller jobs for their lack of hassle. When you have a good one look after them well (birthday presents, christmas presents etc) whatever it takes! Finding them is the tricky part. I’ve found guys like these never advertise and can only be found via word of mouth so always be on the lookout. To date I’ve managed to avoid full management.

      Pets – I always advertise for tenants with no pets but have on many occasions allowed them. Again it comes down to the people and my judgement. If it’s a nice person with a long life moggy or an old dog I don’t have an issue. If it’s a family of 7 with a herd of bullmastifs I’ll let them rent somewhere else. If they do have pets I have a clause written into the contract stating that they’ll pay for any pet damage (scratched skirting/carpets etc). If they’re happy with such a clause then (to date) i’ve found they’ll look after the place.

      • Nibbler October 10, 2014, 1:59 pm

        Yes, retired builders sound like a good profile to look out for. I have met them and will try to keep in touch with the next one (with gifts!)

        Initially we didn’t allow pets. But considering the property in question was opposite a common it seemed a bit mean to decline even the smallest of pooches. The tennants that came with the dog seemed promising, but time will tell if it was a good descision.

  • Nigel October 11, 2014, 3:54 pm

    This is a great post which complements your other posts concerning buy to let. I have taken on board some additional rules of thumb from this set of posts. We have just one flat which we have rented for around 15 years to a selection of tenants. I agree that meeting and assessing the tenants yourself is vital to avoid many potential problems, unless you own a large portfolio of properties. Gut instinct plays a key role when combined with the analysis of credit checks. We rent fully furnished, and try to provide reasonable quality (bed, white goods, etc). May I ask what level of furnishing you provide, as you suggest avoiding fully furnished? Do you only provide the white goods, without beds, tables, chairs, sofas, etc?

    • Under The Money Tree October 11, 2014, 7:45 pm

      Glad you’ve found some useful insights on the site.

      I always rent my places ‘unfurnished’ which typically means I provide the white goods (washing machine, dishwasher, cooker etc), light fixtures, curtains & carpets (or floor boards where possible) only. No tables, chairs, sofas, beds, wardrobes etc.

      My logic and experience is that if people have to move all their own furniture in, and absorb the associated hassle/costs, they are far less likely to just stay for the minimum tenancy period. Also if it is their furniture in the place, they are much more likely to think of the place as ‘theirs’ and look after the property.

      Of course you can typically charge a little more for fully furnished rentals but for my properties I’ve yet to be convinced that the extra rent is worth the extra hassle and increased turn around of tenants.

  • Cerridwen October 12, 2014, 6:30 am

    Hi. Some really good tips here. Thanks.

    I have heard it said that one of the mistakes you can make is to use an expensive high street letting agent rather than an online service. There is certainly a big difference in price. I’ve worked out that we could be saving around £1000 per year on our small studio rental by switching to online.

    I’ve therefore done the research and will be taking the plunge and going it alone this time around. (With the help of OpenRent). Even if we have to go back to the “professionals” I wouldn’t be using our last agents as they were sometimes anything but. We met the current tenant for the first time last week and discovered that a bathroom fan we paid for replacing 4 months ago had never actually been fixed. I’ve learnt that having a completely “hands off” approach just doesn’t seem to work.

    • Under The Money Tree October 12, 2014, 1:00 pm

      Cowboy agents are something to be feared as your experience shows. I typically just pay a tenant finding fee.

      Thankfully one of the agents I use is a family run business so over the years I’ve got to know them and they know the ‘profile’ of tenants I’m looking for and I can trust them more to screen out potentials. Unfortunately the other agent I use runs on a different operating model. Every time I need a new tenant the staff are all completely different and the agents, while all bright young things, are typically just after their commission. I need to pay ,much more attention to this property and communicate exactly what I want/expect from them.

      I look forward to hearing how you get on with OpenRent, do report back on that and good luck going solo!

  • Steve October 15, 2014, 12:09 am

    I would add “Know where your agents interests lie” to the tips. I have opted for full management through a local high-street agent because, it should be simpler for me and after negotiation the difference in fees was pretty small. I have learnt from hard experience that while their periodic inspections are a useful backstop, they miss an awful lot – three years of a downpipe pouring a roof-full of water down a wall; water stains on ceilings, unauthorised redecoration (very poorly done). Unless the dwelling has turned into a crack-den they are unlikely to care much… and even then only if rent is not forthcoming. So check the property yourself at least once a year.

    Like many people, I don’t have a little black book of useful trades people and have relied on the agent for jobs that crop up. To be fair I have been mostly happy with the results but found you have to keep on top of the price as they have no incentive to find you the best price/quality going – they want a job done quickly and without fuss on their part.

    Letting is not my day job, so I am happy to pay for people who know how to market / sell… I just make sure I get my moneys worth.

    • Under The Money Tree October 15, 2014, 11:36 am

      Excellent advice regarding checking your property regularly, in particular drainage. Any issues with drains/water run off can cause expensive repair bill if left unattended for long periods. I too found that one out the hard way a few years ago!

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