Allow Landlords to evict tenants where there are 14 days rent arrears14:34 PM, 1st October 2020
About 3 weeks ago 97
Landlords advice – 10 things landlords should seriously consider before it is too late
1. Know when to stop investing and start living. I have a friend who is fast approaching 50 years old who owns 82 properties. His goal is to get to 100. What’s the point? 100 is just another number isn’t it? What would you rather own, 100 properties up North or one large shopping Mall? I know which I would choose! Let’s say his properties are worth just £50k each, that means his portfolio is worth about £4 million. I can’t find a period in history when property values haven’t doubled in value over 20 years – feel free to correct me if you know different. Even if he’s got 100% mortgages today and never pays a penny off the capital he’s likely to be worth at least £4 million net well before he’s 70 if history repeats itself. Think what effect inflation will have had on his rental income and net profits too!
2. Learn to delegate and empower. I know a couple in their late 60’s. They enjoy short breaks in their caravan but they never spend any long periods away because they are so tied to their business. They are worth millions, a bit like my friend above just 20 years on. If they could just learn to trust somebody else to manage their portfolio their lives could be so different. Full Property Management need not cost a fortune, in fact, I’ve found an ARLA member offering an excellent service from just £14.99 plus VAT per property, per month.
3. Succession planning. Can you believe that 70% of landlords have not made a Will? An even greater percentage have not even heard of lasting powers of attorney, never mind got them sorted. The consequences of not having these vital pieces of paper in place are added grief, family squabbles, the potential of paying more tax than necessary and perhaps the worst of all is that a Civil Servant could end up making decisions about your property portfolio if you are unable to make them for yourself. See Office of the Public Guardian.
4. Consider your taxation strategy as it can make a massive difference to the amount of profits you retain
5. Work out how much life insurance your beneficiaries might need to be in a position to refinance your properties into their name and then get it sorted. There are four good reasons to do this as soon as possible. The first is that you never know how long you’ve got left. Second; life insurance costs more the older you get. Third; your health may deteriorate and you may not be able to get anybody to insure you at all. Fourth; when you apply for life insurance the insurance company usually pays for a full medical. You’d pay a fortune to have this done privately so why not let the insurance companies pay for you to get yourself checked out?
6. Make sure that any life insurance you have is written into trust. If it isn’t, then it forms part of your estate and if your beneficiary is anybody other than your husband, wife or civil partner then 40% tax will be payable on the proceeds over and above the inheritance tax threshold. One simple piece of paper, provided free by most life insurance companies, could result in your estate paying far less inheritance tax. The frightening this is that most life insurance is not written into trust.
7. Join a Landlords Association and go to the meetings. They are a great place to pick up landlords advice. You have to do things for yourself but it’s harder to do everything alone. Join a bigger T.E.A.M. (Together Everybody Achieves More). I’ve always said that is cheaper to learn from other people experiences that is it to learn from your own mistakes.
8. Review your portfolio and your financial position regularly. There is a saying I really love “the wonderful things and not planning and reviewing your plan is that failure comes as a complete surprise and is not preceded by periods of stress and worry”. Who plans to fail though? Very few I suspect but several people fail to plan. Here’s a really simple calculator to get you on you way to reviewing your property portfolio – Portfolio Review Calculator
9. Stay informed, if you haven’t already signed up to receive the Property118 landlords daily updates do so now. It’s free and it takes less than 10 seconds. Start by clicking here.
10. Get professional advice. If you owned a £100,000 car you wouldn’t service it yourself would you? Let us help you by putting you in touch with the professional advisers you are likely to need to give you the quality of Landlords Advice you deserve. Simply call us on 01603 489118.
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