What is an amateur landlord?

What is an amateur landlord?

12:47 PM, 19th October 2013, About 9 years ago 44

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The phrase “amateur landlord” annoys me, I really wish people would stop using it.

First off, if you were a tenant would you want to be dealing with an amateur landlord?

I don’t recall ever seeing an advert on Rightmove or Zoopla which reads “Amateur landlord offers this stunning 3 bed ……” do you?

Would you put the words amateur landlord in you to let advert?

The phrase smacks of the landlord behaving amateurishly or not having a clue about what they are doing doesn’t it? What is an amateur landlord?

Dictionary definitions of the word amateur include:-

  • activity as a pastime rather than as a profession
  • one lacking the skill of a professional
  • not professional; unskillful

Are these the descriptions that people with just one or two rental properties wish to affiliate themselves with?

A landlord who owns just one property should still act professionally shouldn’t they?

I don’t really understand why the phrase “amateur landlord” ever came about. People who rent out property take an income from the rent, some spend any profits, some reinvest them and all are hoping for capital growth. Whilst this may not be their main profession, and often isn’t, surely they can’t claim to be amateurs? Why would they want to?

Perhaps they don’t want to be called professional landlords in the hope that Consumer Laws will protect them? Well there is no legal definition for what a professional landlord is anyway so I can’t see how that makes any difference. The legal case of OFT vs Foxtons ruled that landlords can be protected by consumer laws, however, the case didn’t set any a criteria for what constitutes a landlord no longer being a consumer.

Would these be consumers?

1) Let’s assume a person earned £500,000 a year as a banker and owned 30 investment properties making a net profit of a further £50,000 a year would that person still be a consumer?

2) Turn the numbers around and let’s assume the banker is making £500,000 of net profit a year from his property portfolio and £50k a year from a non-exec Directorship, what then? Logic might suggest he can’t possibly be a consumer any more because the vast majority of his income comes from being a landlord right? Well I’m not so sure about that either.

3) What about a housewife who owns one property making £50 a month profit after all expenses and has no other income?

The housewife with one property might be the better landlord too, hence more professional?

So is it number of properties which should set the precedent of whether a person remains a consumer or should it be based on what percentage of their earnings relate to rental properties. Based on the three examples above I can’t see logically how it could be either of these.

So, with no precise legal definition for what is a consumer landlord why do we have all these other tags?

Why aren’t landlords referred to as landlords?

If we must have further definitions I suggest the following:-

  1. Accredited Landlord – I like this one providing it refers to accreditation by education, not some “jobs for the boys” Council run scheme which inspects properties. I think it should be compulsory for all landlords to be accredited if they wish to manage their own properties.
  2. Rogue landlord – this is meaningless, either they are criminals or they are not.
  3. Portfolio landlord – a person who owns three or more properties (still a consumer though)
  4. Accidental landlord – that’s almost as bad as amateur isn’t it?
  5. Landlady – such a people run pubs or Guest houses. The legal definition of a female who rents out property is a landlord.
  6. Consumer – a landlord who is protected by unfair consumer contract terms – legal definition is required
  7. Sophisticated investor – a landlord who is not a consumer

Thoughts please?



Simone Gilks (Mortgage Adviser)

10:24 AM, 15th November 2013, About 9 years ago

Its quite clear why some amateur landlords go wrong. “Too many buy property for which there’s little tenant demand and they don’t take account of all the costs - things like service charges, maintenance and periods when the property is empty - known as the void periods.”

Another factor is people are often unrealistically optimistic about the kinds of rent they think they can get so their properties end up sitting empty for ages.

So this is where there is the defining difference between Experienced and Amateur, if you are making a business out of being a Landlord you will undeniably ensure that you do not make these kind of mistakes.

There is no right or wrong but as with any investment, you need to see a good return otherwise what's the point?

BUT - surely learning is half the fun - I have enjoyed every part of buying and managing investment properties in my day. Now I spend my time helping those wishing to do the same by teaching them how to understand the costs and financial set up as well as the returns they may or hope to see. Every day is a 'Learning Day' as they say.

Simone Gilks (Mortgage Adviser)

10:53 AM, 15th November 2013, About 9 years ago

Reply to the comment left by "Mark Alexander" at "15/11/2013 - 10:48":

Yes - surely if you are ever in doubt about a property as a way of investing then you need to start using the tools available to you, such as the Landlord Calculators.

Simone Gilks (Mortgage Adviser)

12:32 PM, 15th November 2013, About 9 years ago

You may wonder how the lenders perceives Landlords - Here is there take on the matter -

• First Time Buyer (FTB): An applicant who has not owned any type of property (Residential or Buy to Let) for at least the last six months

• First Time Landlord (FTL): An applicant who has owned their own home for at least the last six months, but has not owned and let a Buy to Let property for the last six months

• Experienced Landlord: An applicant who has owned and let a Buy to Let property for at least the last six months (they may or may not own and occupy their own home)

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