Costs

Buying and maintaining can prove to be expensive and many landlords fail to understand the amount of costs involved. Below is a list of some of the costs involved in buying and maintaining a rental property and it is worth saying this is by no means conclusive.

Buying Costs such as

• Stamp duty
• Solicitor’s fee
• Estate agent’s fees
• Surveyor’s fees
• Land registration fees and searches

Cost of preparing a property for rent such as

• Complying with regulation
• Decoration
• Purchase of furniture and equipment
• Potential cleaning costs
• Any utilities bills before the property is let

Cost of finding tenants

• Self management
• Using a lettings agent
• Marketing the property either via a letting agent or advert (internet, press)
• Time spent in showing a prospective tenant the property
• Tenant checking (referencing)

Cost of securing tenants

• Starting up a tenancy
• Duplicated keys

Running costs

• Mortgage repayment in times of non-occupation
• Lender’s authorisation fee
• Accountant's fee
• Bank charges
• Minor repairs (allow at least 10–15% of 12 months’ rental)
• Council tax*
• Utilities bills* - gas, water, electricity, telephone
• Furniture and furnishings replacement (10–15% of 12 months rent)
• Insurance* - buildings and contents
• Management or service charge
• Ongoing cost of complying with regulation - annual gas checks, electricity
• Cleaning (labour and materials)
• Gardening*
• TV licence*

* You may be responsible for all or some part of the costs depending on the agreement between you and the tenant