A Love For Letting: Making Money on the Rental Market

If you’re looking for a long term investment that’s safe, earns you far more than a high interest savings account at the bank and makes a fun project then why not consider property? Particularly, renting out property. If you get an estate agent to manage things for you then it’s something that you can easily do around a full time job or other commitments as there’s no hassle to you. It also makes a great retirement fund later on, as each month you have the tenants rent landing in your bank account- if the property is paid off by then it’s money you can spend as you wish. However there are a few things you will need to do first to ensure you’re all set up and ready to go.

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Decor

Decorating a property for the rental market takes a few extra considerations. You don’t want to give yourself lots of added work or have to spend significant money between tenants redecorating. For this reason, keep it as a blank canvas. If you give tenants the freedom to redecorate, put a clause in the tenancy agreement that things must be returned back to normal at the end. A coat of paint and the use of a carpet cleaner will always be needed as fair wear and tear is allowed, but it beats having to spend hundreds or even thousands getting things back to the right condition. Keep walls plain and paint them white or magnolia, not only does this create a blank canvas for tenants but it’s cheap to repaint. Put down wooden floors downstairs and hard wearing carpets in a darker colour upstairs, these will stay looking nice for many years. If you want to offer the home as furnished, for example as a student let, you can actually buy furniture designed for the rental market. It’s usually more hardwearing and is often built in so it’s extra sturdy.

Contracts and Credit Checks

If you’re working with an agency this is something they can do for you, but you always have the option of drawing up your own contract. If you choose to go private and not use an agent then this is of course something you will need to do yourself. Again, if you’re using an agent they can arrange things like credit checking and vetting tenants so there’s no hassle to you,  but you always have the option of doing this yourself. If you are very against tenants having pets, smoking for example- make sure this is very clear in the agreement. When doing credit checks, decide how lenient you will be. For example, missed payments or defaults from four or five years ago may not reflect how the person manages their money today. But in some cases, you might prefer to take someone with a perfect or near perfect record to minimise your risk.

Inspections

Communication is key when it comes to property lettings. It might be your property, but it’s home to the person you’re renting to so you need to bear in mind their rights and considerations. If you want to inspect the property, you will usually need to give fair advance notice. It could be best to set out the terms of inspection in your tenancy agreement so everyone knows where they stand.

How to Build Up Your Property Portfolio

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There are few safe investments you can make but one of the best is property. Putting your some of your money into bricks and mortar is a good way to make it work harder for you and will give you a great investment in return.

If you are a smart buyer, finding the right properties will give you a good financial edge and should help you quickly build up a sizeable nest egg. Buying to let is a good way of safeguarding a property and making money while your investment remains. However, if you are looking to make a quick buck, buying and doing up a property is a good route to go too.

Fixer-upper

There is a lot of money to be made in the development of old properties and if you are willing to move about a bit, you could quickly make enough to stay in one house while you do up another. There is a wide range of houses that fall under the term from a fresh coat of paint to full building works so think about what you are willing to take on before you start.

If you have never fixed up a property before, you should definitely request the advice of planning consultants before you implement any radical changes. You will need to gain planning permission for structural works like reconfigurations or extensions and a planning consultant will be able to advise you on the best plan so that you don’t waste any time going through rejections and appeals.

Buy-to-let

When you are looking for a property to rent out, you need to be sure that you will get a renter soon in order to cover your costs. If you can, use savings only to invest in the property, leaving you with enough cash for a rainy day. Otherwise, you need to make sure that your renter will be able to pay enough to cover any buy-to-let mortgage you take out.

You also need to consider who you want your rental to appeal to and decorate accordingly. If you are looking for student lets, make sure that you provide enough neutral furniture so that they can move straight in at the start of term. For other renters, you might be better off showing an unfurnished house as they are more likely to move in for a longer period and want their own things.

Holiday Rental

With the likes of AirBnB arriving, now is a really good time to offer up a property for short term holiday lets. You might not have the security of long term tenants but you will be able to make a considerable amount of profit.

The rules for interior design are also slightly different. You might consider going for a themed house or apartment to make it stand out from the masses or you could use smart design to give a luxury appearance and charge accordingly.

Whatever you choose, investing in property is  good idea for your financial future. It will give you a real investment you can fall back on as will as work your money hard to build up a decent nest egg.

Why teaching your children responsible finance is important

There will come a time when you will sit your children down and tell them how the world works. You care deeply about them, so you’ll teach them how to take care of themselves financially. You may have gone through points in your life when you have had to be frugal and times when you have invested. To set them up with the best knowledge, advice and respect for money, you will need a little help.

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Teach them, don’t lecture them.

Start them off young. You may find lecturing your children how to be responsible with money and taking care how they use it, might be a fruitless exercise. But there are dedicated routes you can put them on, where information in fun bite-sized portions can instil in them the values you want. Millennials by the age of 15 are beginning to understand how the economy works. Instead of sitting them down for a long talk about ‘pennies make the dollars’, give them something they can digest in their own time. Books on avoiding debt and having self-restraint can be a gift on a holiday or for their birthday. Don’t force it down their throats, they are, after all, going through a rebellion period at this age.

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Give them responsibility

Don’t patronise your children, the youngsters today aren’t what they used to be. Technology is at their fingertips, and most kids understand it; more than you might think. Take them with you to the bank, and set up a bank account in their name. Bring them through the process and let them ask you and the branch’s financial advisor questions. Another excellent strategy to get children interested in learning about finance is to go their school and request a fun segment with books, theatre and art on money, be incorporated into their everyday learning.

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A family project in renovating

For the keen, sharp-eyed investors, a property is there to be bought and sold. For the young entrepreneur, the property can be their very first business venture. Buying houses or apartments to renovate then sell, is a fantastic way for teenagers to become their own boss. As a parent or young entrepreneur, working with people you can trust such as family is crucial in taking the first step in the world of risk and reward. Buying an old house with your pooled resources and renovating the property into a modern family or professionals’ home, is a great route. When buying the materials you intend to use, look for deals, buy in bulk and plan out your budget and purchasing schedule. You will most likely be doing the renovating yourselves, so take the time to research the methods of professional builders to avoid time-consuming mistakes. When done correctly, your prudential real estate will be a hot potato, ready to be scooped up by many professionals.

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Selling your hard work

Property development can be a lucrative business. It not only stirs one’s creative juices but also requires the developer to do the research that will make their property incredibly attractive to the market. When it finally comes to selling your investment, auctioning your property to the highest bidder, rather than a fixed price set by a surveyor could give you more than you expected. You’re on shaky ground at this point, because different estate agents will quote you different prices. Go online and find a company with a track record that surpasses the competition, and will fight for you and sell your hard work for the absolute maximum.

Selling Property? Read This First

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Selling a property isn’t quite as simple as a lot of people make out. It can be a complex and daunting task. After all, there’s a good reason why so many people hire outside help during the process!

If you’ve decided to sell a property, be it the home you’re living in currently or another property, then guides like this are pretty essential. Read on to make sure the process is smooth and gives you the best return. These are the things you must take into consideration.

The reason

Why are you selling the home? This may dictate how you’re going to sell it. You need to consider how fast you need to sell it and how much you need to sell it for. Let’s say you’re an investor. If you have the time on your side, then you can afford to wait to ensure you get the best price possible.

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Now let’s say you’re a family who are looking to move home. This, of course, is very different and even more sensitive. You’ll want to sell the place fairly quickly. But you need the best price you can get so you can afford the best house possible for your move! All this is to highlight that the reason for selling a property will determine how you go about the sale – and what results you should expect.

Getting the word out

Most people will choose to work with real estate agents in order to get the marketing done correctly for their house sale. But it’s not a process you should be completely divorced from. There are several steps you can take in order to be more proactive.

For example, writing up an in-depth introduction and description of the property will be appreciated by many customers. Using floor plans software to provide detailed floor plans along with the listing will help give people a clearer vision of the house. And you can even use social media to help advertise the property you’re trying to sell. The more proactive you get during this process, the more you may end up getting out of it!

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Value

This can be the most sensitive part of this process. Some would say it’s the simplest; it can’t be that hard to find out the home’s monetary value, right? Well, don’t jump to any conclusions. Do your best to get to a close estimate. You should do this from a few angles. Getting a valuation by a professional home value assessor is the obvious and best step, but you can also judge the value by other means. If possible, find out the values of some of the other homes in your neighborhood. Check out crime rates and the proximity from valuable amenities, too.

Let’s say you want a good mix of a fast sale and a good price. Try this popular (but slightly risky!) tactic: find out the value, then take 15% or so off that price. It should be a tasty-looking price that brings all the potential buyers to the yard, much like the famed milkshake of Kelis. The desired outcome? These people bidding against each other. This results in the value increasing to the original value, and perhaps even further.

4 Ways To Own Real Estate

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Getting on the property ladder is becoming increasingly more difficult. Before taking the dive into real estate, it’s important to consider all your options. Here are the four major ways that you can own property.

Traditional Buying

Traditional buying is still the main route into property. This is where you buy both the building and the land. Many choose to go through real estate brokers to find property. Finding a seller direct can sometimes be cheaper, but limits options. Some agents may charge buying fees, but this is generally reserved only for sellers. In either case, negotiating the price is recommended – you should aim to haggle of 5% of the value if you can.

You can also buy property off of an auction. Auctions are also a great opportunity for flipping property – discussed later on.

Leasing

In most cases, leasing property involved renting for a fixed term. This could be anything from a year or more. Some lease opportunities are more flexible than other – you may own the property, just not the land. In this instance, you may be able to make minor adjustments to the house as if it were you own. When it comes to traditional renting, hammering a nail in the wall might need permission from your landlord. Leasing is only half owning property, but is a cheaper alternative to buying and a more fixed alternative to renting. In many major cities around the world, the bulk of property is leased.

Self-building

Can’t find a property that meets your criteria? You can always build your own. It can cost up to a third of the price of buying (building and buying the land included), with the option of a self-build mortgage preventing you from having to pay outright. However, it can be a lengthier and more complex procedure. Whilst hiring architects, solicitors and builders isn’t too difficult a task, buying the land is a complex procedure. Land may be environmentally protected, may have limiting restrictions set by a local planning committee or may be physically unbuildable due to the ground. Before buying always check with the current landowner as to what the current restrictions are. In most cases you may negotiate prices.

Flipping

Flipping involves swapping one property directly for another, and so requires you to already own some form of property. By doing it effectively, you can earn a lot of money. Fail to flip correctly and you’ll lose a lot of money, making it a risky venture. Many who get involved in flipping property will buy property off an auction, possibly renovate it and then sell it for a profit. You can flip property without being worried about the profits however – if you want to directly swap with someone to a property that is less value but may be in a better location, you can do this.