Is Being a Landlord Profitable?

shrugEvery year, thousands of people ask the question “is being a landlord profitable?” This is not an easy question to answer, as there are many different factors to consider.

Ultimately, there are some people that are wildly successful being a landlord, and it is even their main source of income. However, there are also people who fail miserably, once they get drowned in a sea of expenses.

Here are some important tips to keep in mind before you take the plunge as a landlord.

Landlord insurance

Before you start renting to tenants, it’s essential that you get adequate landlord insurance so you are completely covered in the event of a worst case scenario.

The best way to find uk landlord insurance is to search online. Locate a good comparison website, and then take a look at what is being offered by different companies.

Never be tempted to ignore landlord insurance altogether, as you would be putting yourself at a tremendous risk.

Are you a handy person?

Make no mistake about it, any rental property that you own will need a lot of repairs over the course of the next few years.

For this reason, it’s always convenient if you are a handy person who feels confident doing the repairs yourself. This can save you a lot of money, as you won’t have to be constantly hiring expensive contractors.

If you don’t consider yourself a handy person, then you will have to bite the bullet and hire a contractor. The best way to keep costs low is to find someone who is affordable and reliable, and then build a good relationship with them so they can take care of any repairs over the long term.

Using real estate agents

Let’s face it, finding suitable tenants is one of the biggest challenges that landlords face. This is why using a real estate agent is usually the right path to take. A good real estate agent will not only be able to find you a tenant for your property, but they will also do all of the necessary background checks and paperwork.

Just be aware that real estate agents don’t come cheap, and if you allow expenses to get out of control, then using a real estate agent can seriously start to eat into your profit margins. When you are first starting out and you don’t have much cash flow, it might be a better idea to avoid using a real estate agency until you have established your rental business.