Is Property a good way to get rich in 2024?
“I want to make money fast!”
“I want to scale my property growth.”
“I want xxx from my property investments within the next four years.”
We hear these comments often, and it's not our approach to investing in properties. For us, properties are all about slow-burn regular cash flow.
Now, let me correct you. This might not be the highest form of cash flow, and there are better ways of doing it. But we don't want to live millionaire lifestyles. We are content with what we have, and we just want more financial independence. This means we get to choose how we spend our time, and we get to choose what we do with our day. This only comes from being in a position of financial freedom. This means a lot of savings, spending less, and using your saved money in a way that works for you.
Now I know this is not most people's bag, especially in the Property world where money is seen as quick and fast. But we would always say that nothing good will be achieved by quick and fast goals, and slow and steady is the way to go. It means we sleep better at night, and we lower our risk threshold. By this, we avoid churn and invest in the safest way in properties such as houses for people looking for long-term properties.
This is what we mean by ethical property investments. Property doesn't have to be scary! Property doesn't have to be an out-there strategy, and it certainly doesn't have to be high-risk.
At My Landlord Cares, we help you to de-risk it as much as possible, and we help our landlords do this. If you're looking into Property and are unsure of the way to start, contact us, and we will be able to guide you in the right way.
Is Property a good way to get rich in 2024?
“I want to make money fast!”
“I want to scale my property growth.”
“I want xxx from my property investments within the next four years.”
We hear these comments often, and it's not our approach to investing in properties. For us, properties are all about slow-burn regular cash flow.
Now, let me correct you. This might not be the highest form of cash flow, and there are better ways of doing it. But we don't want to live millionaire lifestyles. We are content with what we have, and we just want more financial independence. This means we get to choose how we spend our time, and we get to choose what we do with our day. This only comes from being in a position of financial freedom. This means a lot of savings, spending less, and using your saved money in a way that works for you.
Now I know this is not most people's bag, especially in the Property world where money is seen as quick and fast. But we would always say that nothing good will be achieved by quick and fast goals, and slow and steady is the way to go. It means we sleep better at night, and we lower our risk threshold. By this, we avoid churn and invest in the safest way in properties such as houses for people looking for long-term properties.
This is what we mean by ethical property investments. Property doesn't have to be scary! Property doesn't have to be an out-there strategy, and it certainly doesn't have to be high-risk.
At My Landlord Cares, we help you to de-risk it as much as possible, and we help our landlords do this. If you're looking into Property and are unsure of the way to start, contact us, and we will be able to guide you in the right direction.
Beware of ‘tenants in situ’—houses that are sold with tenants
Buy a house and you don’t have to do a thing. You can close your eyes, and the rents will come in. Sounds great, doesn't it? But don’t be fooled! Never ever purchase a property with a ‘tenant in situ’ without getting to know the tenants and landlord first. Recently, we have had a mixture of experiences thanks to more and more landlords purchasing in this manner.
In a less affluent area of Sheffield, we were asked to take over a property after completion. The experience was great, even though we were a bit worried about this. The neighborhood was a state, the house was great inside, and the tenants were very responsive.
On the other side, in a well-off neighborhood, we were instructed by another client to manage their property. Things could not be any worse as the tenant declined to engage. She refused to continue paying rent, and at one point, she slammed the door on us. We found out later that they were problematic tenants, and the landlord struggled to evict them, so he just sold the property with ‘tenants in situ’. The landlords have made this mega-expensive purchase and have not had any rent come in. They had to serve eviction orders.
As I said earlier, get to know both the landlord and the tenant when viewing these types of properties. You will get a good sense of what they are like during initial meetings and even on viewings. Whenever we look at packages for our landlords, these are the types of checks we do, needless to say, with both properties, we were not involved with the purchase.
We provide a complete package and advice on purchase and property management, so you deal with just one company. You are not a piece of luggage being passed around.
Are you considering getting into Property and unsure what the ideal Property is? Then talk to us—we are happy to always take your call.
There is no magic bullet and no fast-track property success
Many others can, though. Well, if you really want to throw thousands away, then go ahead and check them out. But there is no magic bullet and no fast-track property success. My risk appetite is low, and my ambitions are pretty modest. Yes, there are loads of property strategies that I could engage in, but I want a consistent income that is regular and pretty passive.
Plenty of people are worried about the economic climate and whether people should still invest in Property in 2024. I believe it is important to have a diverse income strategy, and Property should be one of your methods of earning income. If that means slow and steady is the way to grow, then hey, book me on! I won't give you fancy acronyms and crazy numbers. I am all about low-risk growth. I definitely play the long game. And if you aim to be financially independent and not a millionaire, and you want to have an opportunity to invest ethically, then you are the right kind of person for us!
It is super important to undertake a goal-setting exercise pretty early in your financial empowerment journey. Work out how much money you would like to live the life of your dreams. Make this achievable, and start breaking down how you will make this. So say, for example, my monthly outgoings are £2000 for my ideal life. This includes food, rent, clothes, holidays, etc. Then I need to work out how I will make that £2000 per month.
This is what I will do for you if you are new to Property Investing. Learn how to create a steady income source.
P.S. If you are looking for high growth, then I am not the right person for you. But if you want low-risk and steady growth, then drop me a message.
Help! My tenant is not responding to my messages!
Landlord ‘J’ knew something was up, but he was just so desperate to get his property back. When he went to his property, he was shocked at the state of it. It took 3 skips to get rid of the junk on the property. Landlord ‘J’ has been super stressed over this period and admits he is not a people person, and this was hands down one of the worst experiences in his working life. In his bid to save money, Landlord ‘J’ thought he could do everything.
Does this sound familiar?
At My Landlord Cares, we spend time building relationships with your tenants so these types of problems can be avoided. This is why we provide a 6-month intensive support programme. In this way, we build this up from day 1.
So if you’re struggling and tired of being a super person, give us a call and claim your life back. Make the property passive again.
Should I purchase property through a LTD company, or personally
This straightforward guide will go through our own personal journey and hopefully will provide some food for thought. It is real and our experience, in its rawest form.
Now we had a very similar predicament last year, when our portfolio was growing. My partner and I were both working as well as managing properties (and people think we have the easy life!)We were worried that the peanuts we make on our profits would get penalised, especially if we fell under the higher income bracket.
So we did the sensible thing and decided to do some research. Google was absolutely awful. It is like when you are self-diagnosing your cough, which Google tells you is the first sign of cancer! One page told us it is the bees' knees, and the other said there was so much extra work that it was not worth it (remember, we are both working, have children, and managing properties). The thought of more work frightened the life out of us.
ALWAYS seek out professional advice, pay the money. We spoke to accountants who explained the process a bit more, which included lots of accountancy geeky words (such as cash flow, shareholders, I have forgotten many of the rest lol) Setting up the business was relatively straightforward, by the way remember that your personal address will show up (so if you can afford to buy a address please do so). Also, there will be regular yearly reports to fill in. You will need to open a business bank account (you can use a personal one, but it gets messy).
CRAP BITS
There is no stamp duty relief for people who buy properties through LTD companies
The mortgage rates are awful for LTD companies
Be prepared for everyone to hike up their prices when they find out you are a business – no leniency for start-ups
The government really doesn’t care about you. Look at the recent debacle over unpaid rent, and everyone else is getting support but not landlords.
BETTER BITS
The liability is on an ‘unnatural state’, so for example, we had a very awful experience at an auction house (This will be covered in another blog BUYERS BEWARE!) and the idiots wanted to charge us £5k for their sellers ’ fees. Due to the charges being on the company, they will have to sue the company rather than us – this is not looking very much like it should be part of the better bits!
You can claim salaries through the company and take dividends to reduce your tax bill. If you put in a director's loan, which you most likely will do to inject the company with cash to purchase properties, this will mean you can take these out via da director’s loan with no tax implications. This is not possible if you buy a property personally.
If you have children whom you would like to pass property to, with the current capital gains tax and inheritance tax, you end up paying a massive whack to the government. Now we pay our taxes like everyone else, but we have worked hard to purchase these properties. Through a business, you could make your children directors; they can have a stake and pull an income. A good plan for them to love US and keep in our good books, haha.
Now we are struggling to think of better bits, and we are very early in our venture. Maybe more positives will come to life, maybe it will be so tough and hard that we end up dissolving…who knows! Lockdown gave us time to think things through rather than just acting.
The decision is purely personal, and please do seek professional advice before embarking on any route. Use our experience as a personal reflection to help you make a decision, and best of luck in all your endeavours. And this is our plug: if you are a landlord in Sheffield and Rotherham and sick of letting agents, give us a call. We will provide honest and helpful support.
Contact us for a chat.
Is Buy-to-let still a good strategy in 2023?
I attend many property networks, and some investors are doing some really crazy and innovative property investment techniques. This ranges from converting commercial spaces to apartments to creating housing of multiple occupancies to creating Airbnb-style setups. Now, this is all good and well if you really want to grow and scale fast. But it's a lot of risk. Some of these strategies require a lot of capital, with the lure of possible great cash flow.
Property for me was always about finding a healthy balance between profit and low risk, so Buy-to-let always appeals to me. The cash flow in rentals is quite small, but the true potential is in the capital appreciation. To give you an example of this, in a month, an average cash flow (if you're fortunate in the current climate) should be about £200 profit per month, with interest rates being high and the acquisition of property being quite high as well, with Buy-to-let. It's hard to even achieve this, so beware of people who tell you they can give you 10 to 12% returns and investment, especially in this current market. Also factor in mortgage, repairs, insurance, etc., into this equation.
It was one thing when the prices were low before the financial crash of 2008, but we haven't seen those markets in a long, long time. With a £200 pound plus profit per month in mind after outgoings factored in, you can see you'll need a lot of properties to get to a level that will supplement your income. Every property requires a big cash injection. This is in the form of a deposit, stamp duty, solicitors' fees, etc., but Buy-to-let is still the safest and most fundamental rental property type. Completely vanilla, no surprises.
This is what we advocate at My Landlord Cares.
We use Property as an investment vehicle. What I mean by this is that when you put money in the stock market, all financial gurus (the ones that are the most professional and knowledgeable) will tell you to leave it in the market for a long time. Don't touch it, even with its ups and downs. Likewise, we advocate the same concept in the long term. Your property that you will probably purchase at £100,000 in 2023 will most likely, from previous history, be at £150,000 if not more in 2033. So it's a capital appreciation that you are banking on now.
I know this slow and steady approach isn't what many people sign on to when they get into Property. Many who go into Property want quick money and quick cash flow, but it is definitely the least risky way of purchasing properties.
Always balance your risk personality towards your rewards. If you are high-risk, this isn't the strategy for you.
Long-term Buy-to-let allows someone to create a home and live in that property for the long term. We have had tenants who have been with this for more than a decade and have been amazing. They have called this property their home, and we have built up long-term relationships.
This is what we advocate within the private rented sector, rather than the constant churn of tenants. It's about finding the right tenants who are willing to call your property their “home”. So if you are debating what kind of property you are going to buy and what you will be searching for, your next deal, then please have a conversation with us. For us, property is a means of a pension pot and will allow you to gain financial independence. If you're looking for the same, we're happy to talk to you. Contact us.
What should you do when your tenants stop paying rent?
It is already tough to be a landlord. There are plenty of outgoing costs—mortgage, labour, unexpected repairs, insurance, full stop—I can go on and on. But what happens when you think you have found the ideal tenant, where you have settled them in and done all the necessary checks, but suddenly they start being unresponsive? Despite your earnest efforts and best methods of maintaining good communication and banter, things are still not working. The tenant decides to be uncommunicative whenever they feel like it, and strangely enough, it happens when it is rent time.
Every month, you are forced to chase down the payment. Your constant messages and attempts to reach out are initially done in a friendly manner. But soon, the rent arrears become too high, and you opt for a more professional, targeted approach.
As a landlord, reaching out to a tenant for eviction is a last resort. Nobody wants to do it anyway, as it costs money and takes ages. The last time we checked the court system in 2023, it took nine months to evict a tenant! Frankly, which landlord can put up with that level of arrears, stress, and headache?
It is in the best interest of both the landlord and the tenant to work together. Yet despite your best efforts, sometimes things don't go well, and we have to look at another route.
Here at My Landlord Cares, we have regular communication with landlords. If the situations mentioned above arise, it does not surprise the landlord at all, as we regularly inform them of every situation. As a matter of fact, it’s not ideal. But we are here to provide help and guidance for landlords. We aim to assist them all throughout the process of eviction while giving them the right support. This could be GUIDING LANDLORDS to the right agencies that can give them the RIGHT advice and professional service. Truthfully, it’s not what any landlord wants. But let’s face reality—this is a part of the experience of being a landlord.
If you’re struggling in such a situation, please do not hesitate to reach out. Don’t suffer in silence! If you need help, contact us at My Landlord Cares, and we are ready to cater to your needs.
What to consider when investing in properties in 2023?
These are our top tips to look out for when investing :
1. Market Conditions: Before making any investment decision, it is crucial to analyse the current state of the property market. Factors such as supply and demand, housing affordability, and economic indicators can provide insights into the market's health.
2. Rental Demand: Assess the demand for rental properties in your target area. High rental demand indicates a potentially stable income stream, even during periods of interest rate increases.
3. Financial Stability: Evaluate your financial position and risk tolerance. Can you withstand potential fluctuations in rental income and property values brought about by changing interest rates?
4. Mortgage Rates: While interest rates might be on the rise, mortgage rates could still be relatively low compared to historical averages. Securing a favourable mortgage rate could mitigate some of the challenges associated with higher interest rates.
5. Property Selection: Choose your properties wisely. Focus on locations with strong growth prospects and consider properties that have the potential to generate positive cash flow, even in a rising interest rate environment.
6. Diversification: If you're considering investing in real estate in 2023, consider diversifying your portfolio. Owning properties in different regions or with varying property types can spread risk and help mitigate the impact of interest rate changes.
If you are interested within this increasing complexity of the property market, feel free to inquire or interact with this post to get professional advice from trusted Landlords.
Contact us here by clicking on this link
What percentage of Landlords use letting agency?
The rental market is a vast and dynamic landscape, with millions of landlords and tenants engaging in property transactions. A key decision for landlords is whether to manage their properties independently or enlist the services of letting agents. Letting agents act as intermediaries between landlords and tenants, offering various services to simplify the rental process. In this blog, we will explore the percentage of landlords who opt to use letting agents and understand the reasons behind their choice.
Determining the Percentage of Landlords Using Letting Agents:
Obtaining precise data on the percentage of landlords using letting agents can be challenging due to the constantly changing rental market and variations in survey methods. However, multiple surveys and reports provide valuable insights into this aspect.
English Private Landlord Survey:
In the UK, the English Private Landlord Survey conducted in 2018 revealed that approximately 58% of private landlords utilized letting agents to manage their properties. This percentage indicates a substantial portion of landlords opting for professional assistance in handling their rental properties.
National Landlord Investment Show:
According to the National Landlord Investment Show held in various locations across the UK, around 70% of surveyed landlords expressed their reliance on letting agents for property management tasks. This higher percentage demonstrates the growing popularity of using agents among landlords.
Reasons for Using Letting Agents:
- Time-Saving and Convenience:
The rental process involves various time-consuming tasks, such as advertising properties, conducting tenant screenings, and handling maintenance requests. Employing letting agents frees landlords from these responsibilities, allowing them to focus on other endeavours or manage multiple properties efficiently.
Expertise and Market Knowledge:
Letting agents possess specialized knowledge of the rental market, enabling them to set appropriate rental rates, effectively market properties, and attract reliable tenants. This expertise minimizes the risk of potential rental issues and ensures better returns for landlords.
- Legal Compliance and Hassle-Free Management:
Rental laws and regulations can be complex, and landlords need to stay updated to avoid legal pitfalls. Letting agents have an in-depth understanding of the legalities, ensuring that tenancy agreements comply with all requirements and safeguarding landlords' interests.
- Tenant Selection and Conflict Resolution:
Experienced letting agents conduct thorough tenant screenings, significantly reducing the risk of problematic tenants. Moreover, they act as mediators in case of disputes between landlords and tenants, providing a professional and diplomatic approach to resolving issues.
Conclusion:
While the exact percentage of landlords using letting agents may vary depending on the data source, it is evident that a substantial portion of landlords opt for professional assistance in managing their properties. Letting agents offer an array of services that simplify the rental process, save time, and provide expertise in the rental market and legal compliance.
For landlords who value convenience, expert management, and a hassle-free rental experience, enlisting the services of letting agents proves to be a wise choice. However, the decision ultimately depends on individual preferences, property portfolio size, and comfort level in managing properties independently. By understanding the benefits offered by letting agents, landlords can make an informed choice that best suits their unique needs and circumstances in the ever-evolving rental market. To find out more about the letting agency service provided for My Landlord Cares, click here