As a Landlord, how do I keep my cash flow in shape? šļøāāļø
#CAVENDISHEXPERTS! The logical choice for Lettings, Sales and Property Management in Nottingham | Cavendish Residential | One Fletcher Gate NG1 1QS | 0115 941 0656 | www.cavendishproperty.co.uk
Top tips for Landlords on how to keep cash flow in shape...
Before you buy
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Work out 'acceptable' gross yield by dividing annual rent by purchase price š§®
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Example (see link below): Ā£15,900 rent a year on a property bought for Ā£225,000 gives a gross yield of 7.1% š
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Gross yield guide:
5% = Acceptable š
6%-8% = Great š„
8%+ = WHOAAAA! ā
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Gross to net calculation - use 9 months rent instead of 12 š§āāļø
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Prepare 1 month void per year, 1 month maintenance and 1 month Letting fees š¤
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Effectively, Ā£1,325 rent = Ā£11,925 approximate net income per year š¶
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NOTE: you can significantly increase your return on investment by using a BTL mortgage - please email emma.travers@cavendishproperty.co.uk for further information š§
Rent Management
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Run your Tenancy 12 month fixed to expire August/September - these are the busies times for finding new Tenants and therefore you'll reduce void during Tenancy transfer š
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Increase your rent - 10% is an acceptable level š¹
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Consider pets where the Head Lease allows (with relevant clauses in Agreement) - rent can be increase further! š¶
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Only accept Standing Order payments and handle late payments immediately ā”
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Use float balance throughout Tenancy - putting Ā£50 aside each month soon adds up! š
Property Management
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Invest in making property more efficient - saving your Tenants money on utilities means they have better cash flow, which means rent on time š”
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Maintenance is a lot easier on cash flow if you're preventing instead of waiting for things to go wrong - so pop round and actively look for potential issues š
Managing your outgoings
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Do not pay for dilapidations that are down to your Tenant! Keep a strict record from the start to ensure you have the evidence needed to go to adjudication if needed ššøš¹
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Review mortgage deals, insurances and other expenses yearly š
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Move your Rent Due date a week before your mortgage goes out š
šāāļø Are you looking to buy an investment property? Do you have a current investment that's not performing as it should? š Our investment specialist Emma Travers will be able to provide you guidance and support, you can contact her by email at emma.travers@cavendishproperty.co.uk š§
šø Standing: Emma Travers, Property Sourcing with Lisa Dahl-Parsisson Senior Valuer and Asset Manager Sitting: Rosie Beharall, Property Management and Gary Pringle, Head of Maintenance at Cavendish Residential
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