With the proposed changes, and eventual withdrawal, of farm subsidies on the horizon, many farm and rural business are looking to diversify to alternative income streams. One largely overlooked existing asset are farm cottages.
Generally rented on Assured Shorthold Tenancies (AST’s), if actively managed these properties can become a sustainable source of income.
Edwin Thompson’s key points for managing rental properties will help to create a profitable enterprise.
1. Attract High Quality Tenants
A well-presented property with good quality fixtures and heating will attract higher quality tenants reducing chances of arrears and void periods.
2. Inspect Regularly
Annual or 6-monthly checks ensure that tenants are looking after the property and may uncover issues early requiring less cost to remedy.
3. Review Rents Periodically
Smaller, annual increases are more palatable and affordable than larger, infrequent rises also improving cashflow and overall rental income.
4. Keep Paperwork in Order
Keeping records of inventories, schedules of condition, repairs and EPCs’s along with electrical certificates, gas certificates and legionella checks, amongst others, will protect your position on potential claims by tenants and ensure the correct paperwork is to hand when serving notices.
5. Regular Improvements
Small, regular improvements and upkeep will retain existing tenants and avoid large expenditure on exit.
Keeping an open dialogue is key to successful management and retaining good tenants.
- Take a Long-Term View
Well managed properties command higher rents, meet their expenditure requirements, provide a regular income and, importantly, retain capital value.
The past two years have seen major changes in Landlord requirements to provide safe, energy efficient and cost efficient homes. These include EPC band E requirements (see article below), EICR (see article below) and legionella risk checks.
Edwin Thompson’s letting department can advise and assist from advertising and tenant referencing through to drafting a tenancy agreement, serving notices and rent reviews. We
also provide the most up to date legal and best practice guidance. Why not ask about a ‘health check’ to review how your properties are performing and check legal obligations are in place?
Due to COVID-19 we are seeing an increase in demand for rural rental properties and have a waiting list of applicants. If you have an empty property you wish to rent, require advice on or wish to enrol with our management services, please speak to Scott Gillie, head of Residential Lettings in Berwick-upon-Tweed on 01289 304432 or firstname.lastname@example.org.