New landlords 'need to budget carefully'

by Sarah Ashcroft

Property owners who may be feeling the pinch during the current economic climate have been advised to ensure that they budget carefully before letting out homes or offices to members of the public.

According to Malcolm Harrison, spokesman for the Tenancy Deposit Scheme, it is vital for landlords to take into account all of the costs that are likely to increase in order to be able to afford monthly payments.

He noted that while the tenant has to take responsibility for things such as utility bills and a television license, it is up to the proprietor to ensure these are being covered on a regular basis, while switching these back to the owner's name at the end of a lease.

In addition, individuals considering letting out properties are advised to think about the costs of insurance and the price of advertising with a letting agency.

His comments were made after LSL Property Services reported rent increases for the fourth consecutive month to new record highs in July.

Statistics revealed the average cost of leasing a property in England and Wales rose by one per cent to £725 per month, which surpasses the previous high of £720 in October 2011 - while the pace of annual rental inflation also went up.

Mr Harrison went on to note becoming a landlord involves "careful budgeting" at the beginning, while the career choice is "not a way to instant riches".

"You have got to also have some money for maintenance because any property, no matter how well looked after and managed, is going to get problems. The boiler could go or something, so you have got to budget for that," he added.

The LSL Property Services research also revealed rent increases in eight out of ten regions in England and Wales, as those in the south-east climbed at the fastest rate at of 2.2 per cent.

  • Landlord and Tenancy News from Lawpack: Solicitor-approved Rent Increase Notice (Section 13) with expert guidance on how to complete the legal form

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Published on: August 20, 2012

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Rent Increase Notice - Section 13 Notice

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Solicitor-approved rent increase notice for landlords to raise rent. Also known as a Section 13 Notice.

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