In the last 18 months or so rental returns have come up a long way. Yet, many landlords, unaware of the situation keep charging rents a lot below market standards. I know a few people who are happily paying meagre rents praying each day that their landlords do not come to know of the existing market rates.
This is not the only aspect which a landlord should be informed about. In addition, he should know everything about the tenancy agreement, history of rent payments, council compliance reports and so on. The job is willingly undertaken by a property manager if you have employed one. If not, it falls within your ambit of diligence. Let me take you through a few facets of landlord-ship.
Focussed property investors always keep an eye on capital gains and rental yields. How much does a capital asset increase in value over time cannot be estimated right at the outset. However, you will invariably be rewarded with capital gains if you buy your investment property in right location and in historically strong areas which also fall within the ambit of active town planning for future.
I wrote an article recently wherein I summed up how fee and taxes (please include Stamp Duty too) are among the prime buying concerns today. Well! I assume this article then will have its fair share of readers. While you can always claim a few tax benefits as a real estate investor, you should be ready to pay a few taxes just as well (I guess more than a few).
If you manage your property yourself, you will save on costs otherwise billed as “fee of property manager”. You will also be safe with the idea that your profits (and losses) depend upon your own diligence. Great!
