BUY-TO-LET DEAL OF THE WEEK: 1 bed flat in Chichester, £125,000, 8.2% yield

Summary

1 bed flat in Chichester

Listed for sale on 04/11/24 @ £125,000

Rent = £850pcm

Yield = 8.2%

The property is on the market with Hancock & Partners and full details can be found on Rightmove via the following link: www.rightmove.co.uk/properties/154576883

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Five tips to avoid ‘slum landlords’

Despite mainstream perception, the majority of rental properties are let by landlords who wish to provide safe and pleasant accommodation to their tenants, in exchange for receiving a fair rent. Unfortunately, like in any industry, there are rogues that don’t follow this convention and instead treat their tenants (and property) poorly. Here are five tips for tenants to try to sniff out and avoid these so-called ‘slum landlords’. 

1. Check the basics are in place

All rental properties should have an Energy Performance Certificate, Gas Safety Certificate (if there is gas at the property) and an Electrical Installation Condition Report. These three documents ensure the property is suitable in regards to energy efficiency and safe in regards to the gas and electrical installations. If a landlord doesn’t have or know about these, they are illegally letting the property and clearly don’t understand even the most basic of their responsibilities.

2. Check the property’s condition

Don’t just rent a property based on photos or an online advert - be sure to see it in the flesh! Feel free to check fixtures and fittings at viewings; I’m used to prospective tenants checking the shower pressure to ensure it’s adequate before they move-in. Whilst sometimes there will be works scheduled to be done to the property between a viewing and your move-in, be wary if there are structural or troublesome-looking damp problems, as these can be harder to resolve and there’s no guarantee it will be done to your satisfaction (or in the case of a real slum landlord, done at all!).

3. Check where your money goes

Letting agents must have Client Money Protection, whereas dealing with a landlord directly does without this safeguard. Most transactions will be done via online banking nowadays, so at least there’s a trail of what has been paid. Cash in hand payments should be avoided for this reason and may also point towards a landlord with something to hide (you should at least insist on a receipt). 

You may wish to do a Land Registry search on the property you intend to rent (it only costs £3) to ensure the named owner of the property matches the person you’re about to hand your money over to. 

Meanwhile you’ll most likely pay a security deposit (typically five week’s rent), for which it has been mandatory since 2007 for the landlord to register it into a government-approved scheme. Ask them which one they use - any that respond they “don’t bother with that” should be avoided.

4. Check what the service will be like

Online reviews are easy to find for letting agents and should give you a good idea of the level of service you’ll receive. Whilst this is more difficult when renting from landlords, a quick ‘Google search’ of their name should throw up anything particularly nefarious.

Consider the property as it is now - if it’s been left to get run down then that is quite possibly how it will be managed after you’ve moved in too. You might also like to ask the current tenants how they’ve found things at the property and with the landlord.

5. If the landlord isn’t worried, you should be

Landlords are likely to be as anxious of renting to a bad tenant as you are of renting from a bad landlord. Any who seem too relaxed and eager to simply get you to sign on the dotted line may not be as friendly as they first appear. 

Legitimate landlords will typically want proof of your earnings via bank statements and ID (to conform with the ‘Right to Rent’; another legal requirement on their part). If a landlord isn’t concerned about this it might also point towards an overly-relaxed attitude when it comes to                                        their basic legal requirements and resolving ad-hoc maintenance issues.

So, whilst most tenants simply consider the property when they are searching for their new home, it is equally as important to consider who you’ll be renting it from. Consider whether you are confident that you can trust and communicate with your landlord or letting agent openly. Hopefully the tips above will go some way to ensuring you don’t get trapped in a property that looks ok on the surface but is run by someone who turns out to be a ‘slum landlord’.

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BUY-TO-LET DEAL OF THE WEEK: 2 bed flat in Chichester, £185,000, 6.5% yield

Summary

2 bed flat in Chichester

Listed for sale on 11/10/24 @ £185,000

Rent = £1,000pcm

Yield = 6.5%

The property is on the market with White & Brooks and full details can be found on Rightmove via the following link: www.rightmove.co.uk/properties/153649895

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Five tips to avoid ‘nightmare tenants’

Most tenants simply want to live in peace in a home that they can treat as their own, whilst happily paying the going rate to do so. A very small percentage, however, will set out to either mistreat the property or purposely not pay the rent. Here are five tips to avoid these so-called ‘nightmare tenants’:

1. Offer tenants a nice home

If you offer a neglected property in poor condition, you are likely to attract less interest and will have to settle for tenants who are perhaps unable to secure a ‘nicer’ home. Meanwhile, if the property is well-presented, it will attract a wider pool of tenants to choose from and they will most likely take pride in keeping it in good condition. 

This applies to ongoing maintenance issues too; afterall, if you don’t care about the property, why should your tenants? Furthermore, tenants will feel aggrieved paying full rent for a property that isn’t fully-functional or being maintained as it should be. 

2. Match the property to the right tenants

It’s hard to say no sometimes, but a property needs to suit its occupants. For example, most blocks of flats won’t accept pets as it is part of the head lease. This isn’t unreasonable if you think about trying to live with a dog in a small second-floor flat with no access to outside space and with neighbours on all sides of you. It might also be unwise to allow two adults and three children to rent a two-bedroom flat; they simply need more space and amenities than that to live comfortably and to be able to keep the property in good order.

3. Reference thoroughly

This is probably the most critical step in ensuring you avoid ‘nightmare tenants’. Helpfully, referencing is something that prospective tenants with something to hide will try to avoid. Do not take shortcuts because a tenant wants to let the property quickly, can offer monies upfront or because a ‘friend of a friend’ says they’re “good for the rent”. Genuine tenants won’t quibble about you undertaking credit checks and asking for documentation, such as payslips and bank statements, so as to give you a full picture of their financial standing and rental history.

Furthermore, (and similar to point 2) you aren’t doing someone any favours in allowing them to commit to a rental property that is simply too expensive for them in the first place.

4. Ensure all the paperwork is in place

Tenancy agreements should contain clauses relating to sub-letting, noise, pets and other common do’s and don’ts, which will help avoid conflicts later on (and can become grounds for eviction if they are ignored). A detailed inventory, including photos, not only serves as a record if there is a dispute over the deposit at the end of the tenancy, but acts as a deterrent in the first place (as the recording is so detailed) and a guide for tenants at the end of tenancy (so they can check how the property should be left so as to receive their deposit back).

Ensuring all the paperwork is completed and provided to the tenants in the correct manner will also avoid problems later on. For example, if not served correctly, you open yourself up to fines, compensation claims and difficulty in progressing eviction notices if necessary; all of which a ‘nightmare tenant’ could use against you.

5. Keep in touch

Maintaining an open dialogue with tenants and responding to tenancy-related and maintenance queries promptly will encourage a good relationship. Visiting the property regularly will allow you to spot problems early, as well as checking all is ok with the tenants so as to maintain and prolong their tenancy. It also shows you are pro-active and haven’t just ‘left them to it’; tenants are more likely to take liberties with absent landlords. 

There are many other ways to minimise the risk of letting your property to problematic tenants, some of which are quite subtle and come via experience. Ultimately there is no fool proof way to avoid a ‘nightmare tenant’, although these five tips will go a long way to avoid those who seek to enter a tenancy agreement with bad intentions from the outset.

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BUY-TO-LET DEAL OF THE WEEK: 2 bed house in Chichester, £265,000, 5.0% yield

Summary

2 bed house in Chichester

Listed for sale on 12/09/24 @ £275,000

Now = £265,000

Rent = £1,100pcm

Yield = 5.0%

The property is on the market with Bell & Blake and full details can be found on Rightmove via the following link: www.rightmove.co.uk/properties/152349404

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How much does a bedroom cost in Chichester?

Many first-time buyers will start out with a small ‘starter’ home, which is both suited to their needs and matches their modest earnings at the beginning of their careers. But as you get older there’s a tendency for extra possessions to pile up and for extra people to emerge in your life! This made me think; how much is a bedroom in Chichester and how much does it cost to climb the property ladder?

Let’s start with a one-bedroom property (typically a flat). The average price for one of these in Chichester is £200,000. As many will appreciate, the first step is often the hardest and that’s no exception when it comes to buying a property. The income and deposit you’ll require to afford even the most modest of homes in Chichester is probably the greatest barrier to getting on the property market.

Once you do though, and you hopefully rise through the ranks in your chosen career whilst growing your nest, the increase in price to afford an extra bedroom becomes a little easier at each rung of the ladder (in percentage terms).

The average two-bedroom property in Chichester will cost you £320,000 - a premium of £120,000 (60%) compared to a one-bedroom home.

The average three-bedroom property in Chichester will cost you £450,000 - a premium of £130,000 (41%) compared to a two-bedroom home.

The average four-bedroom property in Chichester will cost you £625,000 - a premium of £175,000 (39%) compared to a three-bedroom home.

Of course, this price increase isn’t just for an extra ‘bedroom’. As the number of bedrooms grow, so should the size of the other rooms throughout the house, as well as the outside space and amenities e.g. garden/garage/driveway.

It does however demonstrate that it’s the first couple of steps that are the toughest on the property ladder, which is why it’s common that government policies and incentives focus primarily on first-time buyers. Having said that, bear in mind that the need for an additional bedroom affects the ‘upsizers’ at a time when the financial strain (a new child being the most common) is often at its greatest.

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BUY-TO-LET DEAL OF THE WEEK: 2 bed house in Chichester, £300,000, 5.0% yield

Summary

2 bed house in Chichester

Listed for sale on 08/08/24 @ £315,000

Now = £300,000

Rent = £1,250pcm

Yield = 5.0%

Last sold for £250,000 in February 2020 (+20% in 4 years)

The property is on the market with White & Brooks and full details can be found on Rightmove via the following link: www.rightmove.co.uk/properties/151118822

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