Increase rental income in six easy steps
Our top tips to increase rental income
Landlords should see rental income as a business investment — and all good businesses turn a profit. Here are our top tips.
1. Avoid an empty property
An empty rental costs money. Find good tenants and aim for long-term lets to keep void periods down. If it’s a short let, reduce turnaround time by getting ready to remarket your rental as quickly as possible.
2. Reduce admin costs to increase rental income
Shop around to find estate agents who offer landlords fixed-fee payment options. Online agents — like easyProperty — are often cheaper and free from tie-ins. They charge a lot less than the standard 10–17% of your rental income to let and manage your property.
If you move away from traditional models, you’ll keep more money in your pocket.
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3. Inspect the property now and then
It’s a good idea to inspect your property during a tenancy. Checking its condition lets you spot any damages early, so you can make repairs before they become a major problem. You’ll keep more of your rental income this way.
Most tenants look after properties, but sometimes accidents happen. For this reason, it’s important to have an inventory check in and check out. This makes sure everything is accounted for, and lets you recover funds from the deposit for any damage.
Need a property inspection?
Have a professional, APIP-certified inventory clerk inspect your rental, and get an independent report detailing the outcome.
4. Review your rent
You can review your rent by booking a valuation with a letting agent. Also, check Rightmove and Zoopla to see how much similar properties in the area let for. This allows you to set a competitive price.
Charging too much rent — or too little — can be a problem. Potential tenants pass by properties that are too expensive, but if you undercharge you miss out on a fair rental income. Once the contract’s signed, it’s hard to increase rent. It’s best to have a rent review clause in your agreement, which lets you increase rent in line with inflation once a year.
Before you increase rent, though, it’s best to weigh up the odds. If raising the rent means your well-behaved tenants move out, will the extra rent offset against potential void periods?
For example, a £100 per month increase will fetch an extra £1,200 each year. But if you end up with a month’s void period, how long will it take to recuperate the loss? And that’s without the costs involved in reletting the property.
5. Keep up to date
Regularly checking Government websites means you’ll know about any changes you need to implement. Landlord mailing lists and blogs — like easyProperty’s — also keep you informed of any new legal regulations.
6. Organise taxes
Landlords can reduce the amount of tax paid on rental income by claiming allowable expenses. But it’s vital that you keep all your paperwork (including receipts) to justify your claim.
The type of let affects how much you can claim, so it’s best to check Government websites to make sure you get back all you can. Or read our guide — ‘What expenses can you claim on buy-to-let property?’ — to find out more.
There you have it: six easy tips to help turn a profit on your property. Rent smart, and you’ll keep more of your rental income. What’s not to like about that?