With rents on the rise in Ireland, investing in a property to let can be a good cash source. Being a buy-to-let landlord provides the owner with a regular income. Although it may not always be a simple process, it is usually worth the effort and there are many areas that can provide good rental yields.
Get Your Finances In Order
If you’re considering becoming a buy-to-let landlord you will need to save up for a deposit so that you can get a mortgage.
To get a buy-to-let mortgage, you will typically need to pay a 20% deposit. Your mortgage lender will look at the rental income the property will make, so it’s important that your property can cover the costs.
The mortgage will have to be paid regardless of whether or not there are tenants in the property, so it is important to be able to financially account for periods when the property will not be occupied.
Choose the Right Property
Finding the right property that will be easily let, and will not cause any issues in terms of maintenance, is very important . Conduct your own research online to see what the local rental market is like, and understand what types of properties are being let in your chosen area.
Another option is to employ a buyers’ agency to carry out the process on your behalf. Some buyers’ agencies also provide letting services, and will manage all aspects relating to the letting process, including maintenance, sourcing tenants, and collecting rent. They can also provide a rental appraisal of the property and hold viewings to find suitable tenants.
It is also useful to contact letting agents, as they have an insight into the rental market. They will be able to provide information on what kinds of properties let quickly and what kinds are in short supply. Their knowledge of the market will also ensure that you get a good yield on your purchase and can be the difference in making a profit or a loss on the property.
Organise Legislation as a Buy-To-Let Landlord
- Sign up for a tenancy deposit scheme, so that any deposit you acquire from your tenants is protected in a government-authorised scheme
- If you decide to house several tenants in the same property on separate contracts (i.e. student housing or dorms) you will have to get a Houses in Multiple Occupancy (HMO) License
- Draw up a rent review notice if you plan on increasing rent, informing tenants ninety days beforehand
- Register tenancy agreements with the Residential Tenancies Board (RTB)
- Provide a rent book
The money you make from letting the property may be used to cover mortgage repayments.
You should consider other costs that might come into play such as
- maintenance costs
- the cost of refurbishing the property
- fees for advertising your property to tenants from letting agencies
- landlord insurance, to cover any damages
- be able to account for void periods,when your property is empty and not being rented out
Your Responsibilities as a Buy-To-Let Landlord
- Repairs to the structure of the property inside and outside
- Ensuring the safety of gas and electrical appliances
- Checking that furniture meets fire-safety regulations
- Maintaining any installations, heating, bathrooms, and water systems
- Conducting condition checks and rental inspections
- Finding tenants, checking their references, and collecting rent
It is up to you to decide whether or not you can manage the property yourself, if you have the time to conduct maintenance, viewings and collect payments, or if it’s easier to have a professional do this on your behalf. A letting agent can manage the upkeep costs and send you a monthly statement with a breakdown of payments and works. They are the first port of call for the tenants and have a network of contacts so that emergencies can be dealt with promptly.
If you are interested in our Investor or Letting & Management Services, fill out a contact form and we will be in touch to arrange a free consultation.