Landlord Surgeries

Belvoir runs FREE surgeries for Landlords, covering all aspects of letting a property. These tend to be run out of office hours, or at weekends.

All Landlords are welcome, whether or not we manage your property, and surgeries tend to attract private landlords or landlords with properties with another agent more than our own customers.

Either myself, or my Lettings Manager Victoria Brewerton-Owen run the surgeries, which cover pretty much anything to do with renting properties. Whilst we’re not solicitors, we do have a relatively good knowledge of tenancy law, and are able to advise on the majority of issues relating to tenancies. We offer a 1-2-1 consultation with everyone who attends. At previous surgeries, issues raised by landlords have included:

• problems with current tenants
• problems with Lettings Agents.
• problems with the Local Authority.
• deciding which investment property to buy.
• deciding whether to rent or sell a property.
• understanding what letting a property involves.

We also hold occasional surgeries in central London for portfolio investors. Places are still available at our next Rugby surgery (end of January) and the Northampton surgery in February – if you want to come, or know someone who needs some guidance, let us know (richard.baker@belvoirlettings.com). 

Richard

Property to sell? We know a man that can!

As a Belvoir Landlord, you can now get preferential deals with local estate agents when you come to sell a property.

As the lettings specialist, we don't sell properties. However we do have a number of landlords who want to sell, and we also have a number of landlords that trade properties on a regular basis. For many of our landlords, one of the problem with selling is that their existing tenant gets fed up with estate agents constantly being in and out of their house, so gives notice and leaves. The landlord hence ends up with an empty property and loses rental income for the rest of the sales process.

Belvoir has reached an agreement with a local agent to try and avoid this. Clearly the scenario above can never be 100% removed, but by working together with the local agent, we've negotiated the following:

• Agent charges 1.25% + VAT for selling the property, with a minimum charge of £1500 + VAT. The average sales commission in Northampton is currently around 1.7% + VAT and in Rugby around 1.8% + VAT.
• Property is advertised on Rightmove and other key property portals.
• Agent works to an agreed code with Belvoir, regarding what time and how frequently the property is accessed for viewings. Seeking to keep the tenant for as long as possible, potential viewers are channelled to appointment times that will cause least conflict with the tenant.

If you are considering selling, or know someone that is, please contact me (richard.baker@belvoirlettings.com) and I’ll put you in touch. As ever I’m happy to answer any questions regarding the above.

Richard.

Market update!

It’s been a busy start to 2011….

Rugby – nearly all properties let – we’re desperately short of stock. Every new property we’ve taken on this year is let, and we’re only on the 16^th of the month.

Northampton – best start to a year ever – stock is diminishing rapidly. Ongoing tenant demand for good quality properties of all sizes. Also, a massive shortage of properties for the DSS market – about 4,000 to be precise.

The summary is that 2011 has started as 2010 ended – healthy demand from good quality tenants, and a genuine shortage of good quality properties. An interesting comparison is the number of properties available across the whole town – at the start of 2010 it was over 1000, whereas at the start of 2011 it’s just under 600 – a drop of over 40%.

We have a number of landlords who have purchases lined up – there are some decent buys out there and the signs in early 2011 are that the sales market hasn’t significantly picked up from last year. As such the potential for further acquisitions continues. I’m seeing a property next week available for around £80k that should rent for £800 per month – a healthy return for whoever buys it.

The strength of the current market also means that it’s possible to raise rents in certain properties. This won’t happen across the board – the market for 2 bed apartments in Northampton for instance remains saturated, which will put the brakes on the rental price achievable. We also have to balance the potential for any increase against the potential of losing a decent tenant – landlords feel differently about this – some are happy to take the risk, some aren’t. My teams in Northampton and Rugby are however reviewing all tenancies, and will be in touch with all landlords on an individual basis where we feel a rental increase is achievable.

The main challenge for ourselves as an agency remains sourcing properties. Before Christmas we did announce that we were happy to pay a referral fee to existing customers who know of other landlords with an empty property. We’re happy to continue this until the end of February at least, subject to the terms previously posted.

Richard.

Ten Top Tips For Buying in 2011 (part 2)

I'm aware that as a result of falling property prices, many landlords are looking to dip into the market and acquire more property. I often get asked how they should approach this and what they should consider. I'm giving 10 tips to people who are considering purchasing - last week I gave 1-5, now here's 6-10.

6) Remember you're not living there.  There is always a tendency when buying a property to go for something that feels 'safe'. "If I like it, others will too"! True, but on the reverse side, just because you don't like it doesn't mean it won't rent, and doesn't mean it isn't a good investment. Often the best investments financially are properties that you may not wish to live in yourself, but which deliver an excellent yield. Equally, you're not living there, so don't decorate to personal taste. You may have always wanted a chocolate carpet, but your tenants certainly don't. You may prefer a bath instead of a shower, but again your tenants won't. Successful renting is about appealing to the widest possible market - white, magnolia, and neutral flooring. It's very boring, but people never object to it. 

7) Leave some contingency. Your property is a long term investment, and you must look after it as you do your own house. On many occasions I've seen landlords stretch themselves financially to the limit to buy an investment property, only to react with horror when the heating fails and a plumber needs to visit - at some point the electric shower WILL break, and you WILL need to replace it. In whatever financial calculations you're making, you must leave some contingency for a rainy day. In the recent cold weather, I visited a property with the landlord where the pipes had frozen causing a flood, and about £10k of damage - the landlord had tried to 'save' by not having buildings insurance. The most sensible and successful landlords return to their property between each tenancy and do what's required to make sure the condition is tip top - they are rewarded generally with tenancies that last longer, better rents, and fewer void periods.
8) Haggle. It is very much a buyer’s market. Sales are at a premium with vendors holding on to try and get a half decent price. Some have a price they can't go below (otherwise they lose money) and as such their property doesn't sell. Keep your eye out for properties where the vendor simply wants to 'get rid', and is prepared to negotiate on price as a result - it's very very hard to sell a property for MORE than it's worth, but you can buy a property for LESS than it's worth. When transacting in property, you often make your money on the PURCHASE rather than the SALE. Repossessions are a classic example of this - on a row of identical properties in St James, Northampton, there have been six sales in 2010. Four were between £90 and £100k on the open market. Two were between £70k and £73k - both repossessions. The latter 2 were clearly the ones to buy, as getting them tenantable would have cost no more than a few thousand pounds. Don't be afraid to make 'cheeky' offers for properties and see what happens.
9) DON'T overpay for a smart property. What ever the state of the housing market, a property that is well presented will always command a premium over a property that isn't. Don't fall into the trap of paying £10k over the odds for a property that has had a lick of paint costing £1k. You don't want to buy something that is falling down, but a lot of the time, a property that looks pretty dull can be acquired cheaply, and turned into something smart for a reasonable cost - far less than purchasing the house in a finished condition. It's more or less impossible to SELL a property for MORE than it's worth, but it is possible to BUY a property for LESS than it's worth - this is where the canny investor makes is money - don't be put off by a property that looks rubbish, but isn't. If you are unsure of what needs doing and what it will cost, ASK US - often our maintenance people will give you a fixed price on completing the works. 

10) DON'T skimp on presentation. It's a fact that well presented properties rent far more quickly than those that are dated or need decoration. Keeping your property smart, clean, neutral, and well decorated might cost you money in the short term, but it will save you money in the long term though higher rents and reduced void periods. If you're renting a property in the medium term (5 years plus) it's never a bad idea to get it perfect at the start, rather than patch up as time goes on. 


If you want to be added to our list of landlords who are contacted when a good investment becomes available, let me know at richard.baker@belvoirlettings.com. 

Richard.

Ten Top Tips For Buying in 2011 (part 1)

I'm aware that as a result of falling property prices, many landlords are looking to dip into the market and acquire more property. I often get asked how they should approach this and what they should consider. Over the next 2 blogs, I'll give 10 tips that people should think about. From the reverse perspective, these are 10 mistakes I've seen landlords regularly make!

1) Yield or Capital Appreciation, or both?

Why are you buying this property? Do you want to make money on a monthly basis, or are you more interested in making money on the value of the property over a period of time? Or do you want a little bit of both? Your requirements here will shape where you look for property - some areas offer a much better yield, others have better long term prospects. Rarely does an area have everything (or we'd all be shopping for property there!) but some offer a happy medium.

2) Research the market.

A lot of research you can do yourself. These days information is very freely available on the internet, regarding what properties are advertised at and what properties have sold at. If you're being asked to pay £100k for a property when the identical one next door recently sold for £80k, you need to ask yourself why. Equally you can see for yourself what similar properties rent for nearby - a property nearly always achieves within £50 of the asking price, unless the asking price is over £1000PCM in which case the variance can be greater.

3) DON'T listen to an estate agent.

This is the classic mistake to make! An estate agent is paid by a vendor to sell a property. If they don't sell it, they don't get paid. As such an agent will say pretty much anything to get a person to buy. Estate agents get criticised for this, but commercially it's perfectly logical. As such when an agent is telling you the price is a good one, or the property will rent for far more than you thought it would, or that the internal condition doesn't matter because it's only a rental property, don't believe them without doing further research! In 5 years as a letting agent, I've lost count of the number of landlords that have sworn blind their property is worth more than it is, because the selling agent told them it was - people fall for this again and again and again.

4) DO listen to a lettings agent.

I would say this, wouldn't I, but again it's commercially logical. A lettings agent doesn't make a penny out of a landlord if the property sits empty. As such it's in the lettings agents interests for the landlord to get a property that rents easily, quickly, and consistently. If you buy something that's tricky to let, it will cost me a fortune! As such we have some shared interest!

5) Be sceptical about leasehold properties.

Landlords are often attracted to leasehold properties as they often trade for less, there are often deals to be done, and there's a perception that tenants like flats. Whilst, to an extent, the latter point is true, tenants only like flats because they tend to be modern inside - give tenants a modern house and they'll take that every time. Reasons to be cautious about leasehold properties are:

a) you pay the service charge, which can kill your rental yield. you also still pay for anything that goes wrong inside the flat, so don't think you're saving too much on maintenance and upkeep.

b) if the lease runs down, so does the value of your investment. Extending a lease costs £££.

c) you have little control over the communal areas. if there are problems with maintenance and condition, it's really hard for you to directly affect, and it will hit the rentability of your property.

d) modern flats have been savaged on price more than any other type of property in the recent housing slump. I have landlords who paid over £150k for something that is now worth less than £100k. Equally when ever a plot of land becomes available, it's flats that go up these days, whereas small houses never get built. As such, due to supply and demand, it's hard to see flats appreciating in value at the same rate as houses.

So that's 1-5, next week it's 6-10.

Richard.