First Homeowner problems? Consider This...
It would seem that the news today has
great pleasure in telling everyone that if they do not have a house now, they
never will. The property market seems doomed for anyone that isn’t already in
it. With the mortgage being labelled the ‘most dangerous financial product in
the world’[i],
many have been put off the whole process and are not prepared to take one out
at all.
But, if you think of it this way: for
anyone renting at the moment, it is almost certain that your monthly rent
packet goes towards paying someone else’s mortgage off, while steadily chipping
away at your home owning dream fund. With the whole ‘if you can’t beat them,
join them!’ philosophy in mind, it is definitely an aspiring idea worth
thinking about that could make taking the scary mortgage route worth it in the
long-term.
Be
a landlord!
This may seem like a pretty far-fetched
idea when you do not have a chance of buying even your first property yet, but
hear me out. On average a four bed house in Sheffield (one of the cheaper
housing areas) could bring in between £36 and £45 a week![ii] So, with this
sort of money coming in a month, it is a definite way to make your money back,
with profit, on your property. The only drawback being it will not be straight
away (when you first need it!)
How?
There are different ways of doing it:
you can use a letting agent to take control of renting and maintaining your
house which makes it less hassle, but also more expensive (which, if you are
reading this, is probably the most far-fetched option).
Alternatively, you can be your own
landlord. This means you get to keep all the financial rewards of being a
landlord, but also, that you are responsible for the maintenance and upkeep of
the house and any issues that come with it.
Then there is perhaps the most viable
option for those in the common property pickle: you can part-rent the home you
live in. This saves the agency fees, and the cost of finding another house for
you to live in, but it also puts you right in the face of any problems that
your tenants may have, which may not always be comfortable.
But…
There are many responsibilities that come
with being a landlord, but luckily enough there are affordable ways of doing
this (thank goodness!). As a landlord you require special landlord insurance; however,
with so many comparison websites around it is not hard to find a good deal to
suit your property, and there are definitely landlord insurance options
available to bring down the costs.
It will also be your responsibility to
obtain safety certificates for all appliances; Gas Safe heating engineers are
all able to do this. You must also offer an Energy Performance Certificate
which you can get from any Domestic Energy Assessor you find online or in the
phone book (or go to the official HCR assessordirectory). On average, this will only cost around £100 for a standard
sized house.
It will also be your responsibility to
make sure all furniture and upholstery complies with the Furniture and Furnishings(Fire) (Safety) Regulations. However, you could always opt to offer your
house unfurnished, which is an easier option, and this allows tenants to feel
much more at home. This is also cheaper as it will not be your responsibility
to fix or replace any furniture that is damaged at the property.
So there are many benefits in becoming
a landlord; obviously there are many more things that come into it, or all
homeowners would be one. But it is something to think about if you are about to
give up all hope of getting onto the property ladder at all.
For more information, Channel 4 has a
brilliant how-toguide.
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