Time to sell up or carry on letting your property?
NRLA partner Inventory Hive explain the benefits of streamlining and investing in efficiency.
The buy-to-let market suffered during 2022 with landlords selling more properties than they purchased, according to analysis by Hamptons – and it’s not difficult to understand the motivations for selling up. Being a landlord during the current financial climate in an industry with countless regulations and increasing tenant rights, requires a big commitment and smart processes.
But, there’s still a great deal to be gained for those prepared to stay in for the long game – not just for the big agents but the smaller landlords too.
To sell or to let? That is the question…
If you’re weighing up the pros and cons for selling or staying in the private rental sector, the likelihood is you’ve hit a stalemate.
On one hand, if you sell, you can release equity in your property, focus on a smaller portfolio of the most profitable properties, reduce your maintenance costs, or get out of the game altogether, waving a happy goodbye to the many compliance hoops you need to regularly jump through.
On the other hand, you stand to lose out on future growth in what is still a strong and appreciating asset (and better than cash in your pocket) if you sell. Rentals are in high demand and, since the pandemic, the industry has become significantly easier to manage thanks to an accelerated digital transformation.
It's time to streamline
Buy-to-let has never been a get-quick-rich scheme; it’s a long-term investment. That hasn’t changed.
If you can hold your nerve and take advantage of the new way of letting (a way to reduce unnecessary costs, stay on top of regulations, avoid disputes, mitigate damage, and maintain consistent rentals), it will pay off – especially if the rental market becomes smaller.
This is the perfect time to streamline and level-up your processes. Instead of exiting, give your tenancy management an audit and answer these questions:
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What impact are void periods having on your yield?
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Could your inspections be tightened to predict and prevent costly fixes?
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Is poor tenant communication causing costly disputes?
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Are poor tenant relationships causing bad reviews and reputation?
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Are you struggling to stay on top of legislation and incurring fees as a result?
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Are you spending too much time and money on admin?
By analysing your systems, documents, workflow and tenant management approach, you will see areas for improvement that could improve your profits.
Invest in efficiency
These days, a small investment in technology can deliver big boosts to efficiency for letting agents and landlords. Apps can make sure your inspections happen on time, keep your maintenance up to date, improve your tenant relationships, make your communications more responsive, and keep an eye on your legal requirements.
This, in turn, keeps your rentals consistent, your properties protected, and your overall rental risks reduced.
If you stick with renting and optimise your tenancy processes, while others around you sell up, the industry will start to work in your favour – possibly even more so than you initially predicted.
Learn more about Inventory Hive here.