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Henry D · 11-10-2012, 01:25 PM

You can research all you want to, but if you don't understand the dynamics of the market and the area you're buying in, and you can't analyse the research anyway, then research all you want but, a novice will still make a mistake as they don't look at it in the way an experience investor does from the start.

The one biggest mistake is not being able to work out the yield of and not knowing what the true yield will be after the agent has filled you up with bla bla!

Yield advertised 12% - reality loads of voids, poor qualit Shy

y tenants, net yield reality 7%

Paul Barrett · 11-10-2012, 06:52 PM

NOT knowing how fundamental RGI is to support any property investment.
Such a necessity then forces investment in property types where the prospective tenants would qualify for RGI.
If you wish to invest in property types which would not attract tenants who could qualify for RGI then you need to have vast resources to cover tenants not paying rent.
All other types of strategies whilst important are not as fundamental as ensuring you will have tenants paying rent..
No RGI and you could have to subsidise a tenant's lifestyle for many months before you evict them.
It doesn't mater how clever or astute or how diligent you may be.
If the tenant doesn't pay rent you are stuffed unless you have back up monies to cover things
47 % of tenants are in rent arrears.
No mortgage payment s and the LL ends up with a damaged crdit file for 6 years.
I wrongun tenant could cause damage out of all proportiion to what they do in not paying rent.
Caveat emptor to any newbie.
The tenant is the weakest link in your investment strategy.unless you have protective measures to prevent a non-rent paying ,thieving and damaging tenant to your property dsetroying your financial circumstances.

samiiLRS · 12-10-2012, 11:41 AM

(11-10-2012 08:27 AM)vanessa warwick Wrote: 4. Not vetting tenants sufficiently.

At LRS we find novice landlords (especially) seem to forget the importance of taking both the Date of Birth AND the National Insurance Number of new tenants.

...And as a landlord quite rightly pointed out to me the other day; new landlords need to adopt a new way of thinking, because they're not just referencing tenants for their own sake but for other landlords in the future aswell - therefore obtaining this simple information will provide landlords of the future with much more useful and stronger data.

Vanessa Warwick · 14-10-2012, 09:28 AM

Under-valuing the importance of the inventory and Schedule of Condition is another one.

Ben Reeve Lewis · 14-10-2012, 02:25 PM

This weekend I did a presentation at the Property Investor's Show at the Excel Arena on the top 5 legal mistakes that landlords make that end up costing them money. It was based on the 5 most common things I see as a TRO, the officers that tenants complain to who get on a landlord's back and who are the main agents for that money having to be shelled out.

Regular readers will know I'm more into educating landlords than prosecuting them, which is why, like Mary Latham, I passionately believe that education is the way forward, not just for landlords either. This week I just ran my first tenant training course too.

If you want to email me you can have a copy of the powerpoint presentation I used benreevelewis@yahoo.co.uk, alternatively I could add it here. Not sure how to do it though.

Pauline · 15-10-2012, 09:09 PM

Never assume that tenants will be fair and honest with you even if you are fair and honest with them. There are some tenants who can only be described as an underclass who will rip you off every step of the way and will do this even more if they know you are a novice landlord.

Ben Reeve Lewis · 15-10-2012, 09:17 PM

Yes thats absolutely right Pauline..........

And there are also scammer landlords intent on ripping off their tenants, thats the nature of the lettings business

Pauline · 15-10-2012, 09:39 PM

Yea there are rip-off landlords too but wouldn't it be great if there was some sort of site to match up good landlords with good tenants to hopefully leave the bad guys out of the equation altogether!

Ben Reeve Lewis · 15-10-2012, 09:51 PM

Lots of us are working on that one from all sides of the fence Pauline. I sit on the steering group of the London Landlords Accreditation Scheme and we run training courses for landlords and tenants to be accredited so we can match them up and promote good practices.

Mary Latham runs Homestamp in the Midlands along similar lines and Property 118 have just started a good landlords campaign.

For my part I actually think that councils (I work for one) can be the glue that pulls them all together, if they can get beyond the computer says no mindset that bedogs the public sector. Things are changing but there is a long way to go on our end to be honest

Pauline · 15-10-2012, 10:27 PM

When I first became a landlord some nine years ago I made the mistake of thinking that landlords were a part of the community that were respected by all since they were providing a place to live for those folk who could not afford to buy their own homes - but how wrong I was!

Many ordinary folk seem to disparage buy-to-let and take the view that landlords are made of money and can afford to lose vast amounts of rental income whenever tenants fail to pay their way or do not put regular rent payments on their list of priorities.

Landlord training and accreditation is all very well but tenants need to be educated too; they need to realise that we as landlords have likely remortgaged our own homes and taken out vast loans in order to provide homes for them and we can never put all their rent money into our own pockets when there are mortgages and a vast array of other overheads to pay each month - it is more often the case that any cash goes out of our account again almost as soon as we receive it.

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