A budget-conscious mindset is sensible for any business, and self-managing your rental homes can feel like a straightforward way to boost your bottom line. But do you have the full picture?
Like you, we watch our outgoings, but we know that the many thousands we spend each year on photos, property portals and industry software make us far more effective (and our lives easier).
It's a rare thing for a landlord to leave us to self-manage. In fact, it's usually the other way around, when DIY landlords either run into trouble or become overwhelmed with changing legislation.
Nonetheless, if you’re weighing up whether to be a self-managing landlord, you've come to exactly the right place to find some clarity. We'll be covering:
- The myth of ‘let and forget’.
- Three good reasons to manage your own rental homes.
- Probable perils and pitfalls.
- Tips for successful self-management.
- What difference do agents actually make?
Given that cost-cutting always has implications beyond initial savings, let's explore what it means to be a self-managing landlord so you can decide whether it's right for you.
THE MYTH OF ‘LET AND FORGET’
No business truly runs itself - somebody somewhere has to do the work. And even if your rental property never aged a day, there are still annual obligations and evolving laws to navigate.
Simply giving your tenant a key and leaving them to it is a shortcut to disputes and significant financial loss, and the current landscape means being aware of things like:
- Changing legislation: Staying compliant requires continuous attention to updates in laws and regulations, from living standards and energy efficiency, right through to successful evictions.
- Property protection: All materials and fittings deteriorate, and tenants don't always spot everything, so regular inspections and maintenance are necessary to avoid costly disasters.
- Council crackdowns: Local authorities are enlisting tenants to help them identify and pursue non-compliant landlords because they get to keep the money they raise from fines.
On a final note, even reliable tenants can experience changes in their financial stability, personal problems, or disputes with neighbours, which all require knowledge and patience to resolve.
THREE GOOD REASONS MANAGE YOUR OWN RENTAL HOMES
Although one reason you might manage your own properties is to save on agent’s fees, there are other factors that indicate whether doing everything yourself will turn out well, including:
- Being a landlord is your life’s primary focus. You’re always on top of changing legal legislation, and you’re committed to staying that way.
- You love being hands-on. Advertising, viewings, references, inventories, tenancy agreements, maintenance, repairs and interim inspections are all things you enjoy.
- You don’t get flustered. When things go wrong or take longer than expected, you naturally handle conflicts, emergencies and difficult situations with a cool head.
There are, of course, landlords who fit this profile. But if you don’t, take some time to consider whether managing tenants and properties yourself will make you happy to wake up each day.
PROBABLE PERILS AND PITFALLS
Every business faces challenges, and managing your own property is no different. Some things you can plan for, others you just have to deal with, so it’s wise to expect your fair share of:
- Petty problems. The number of callout requests we solve by asking, “Is it plugged in?”, “Have you turned it on?” and “Did you try replacing the bulb?” is very high. Be prepared to parent!
- Cowboy contractors. It's taken us years to build a brilliant circle of trustworthy, professional and competent tradespeople, with some bad experiences along the way. Expect the same.
- Legal legwork: Without hard evidence, the law favours tenants in disputes. You need flawless wording and systems for contracts, inventories, deposit protection, fire safety, and notices.
For many landlords, these hurdles highlight the value of expert support to avoid rookie mistakes or simply for a quiet life. Sometimes, the best move is knowing when to bring in the pros.
TIPS FOR SUCCESSFUL SELF-MANAGEMENT
If you’ve decided to self-manage your rental homes, preparation is key, from understanding the law to selecting tenants and having foolproof systems. Follow these tips for a solid start:
- Stay educated. To maintain your knowledge of lettings law, you could join a body like the National Residential Landlords Association (NRLA) for its resources and training.
- Embrace technology. From scheduling safety certificate renewals to ensuring legally correct procedures and notice serving, invest in high-quality property management software.
- Screen tenants thoroughly. Credit ratings, employment details, and financial management checks help you identify reliable tenants. See our Rigorous Referencing blog for more tips.
If you are going to do everything alone, it’s worth putting your time and money into these areas. Being a self-managing landlord involves many risks and challenges, so it pays to arm yourself well.
WHAT DIFFERENCE DO AGENTS ACTUALLY MAKE?
Letting and managing agents are there to fight your corner and essentially provide three types of service that take different jobs and responsibilities off your hands. These include:
- Finding you a tenant, covering the upfront marketing costs, weeding out the best enquiries, conducting viewings, negotiating offers, taking up references, and correct tenancy setup
- Collecting the rent on your behalf, chasing late payments promptly, staying on the case, getting tenants back on track, and issuing notices in line with legislation.
- Managing your property fully, from maintenance, repairs and legal compliance to ensuring your rental income keeps up with the market by suggesting improvements and upgrades.
So the question is: do the financial savings outweigh the reality of doing everything yourself, bearing full legal responsibility for getting everything right, and paying the price of making mistakes?
CONCLUSION
If you’re unsure whether to self-manage or go completely hands-off, we’d love to show you how we help landlords in Birmingham to enjoy a peaceful life of well-performing and profitable properties.
Our solid understanding of lettings law keeps you clear of hefty fines for missteps, so call us on 03338 802 602 or message us at enquire@three2six.co.uk for complete peace of mind and plenty of spare time.
Comments