Are you considering letting out your property? It may be that you want to rent out your current home and move into your dream home or you plan to purchase a second property for the sole purpose of letting it out. Whatever your situation, there are many benefits associated with renting out your property. Read the following advantages to help you decide if becoming a landlord is for you.
Buy-to-let investment is one of the most profitable long-term ventures, as it allows you to obtain consistent income for as long as you own the property. This is known as current income, which is the amount left over after the mortgage and other expenses are paid out. This form of income is actually generated without having to do any work at all, so technically it is free money.
You can increase this income by updating your property through renovation and redecoration which will enable you to charge your tenants more on their rent. Offering services like regular maintenance will also allow your current income to increase, as you’re offering a reputable service to your tenants.
To generate substantial income, your property should preferably be located in an area where tenant demand and rental yields are high. This will usually result in appreciation, which means that over time your property will increase in value due to economic factors such as inflation.
If you have not yet purchased your property, you should consider looking towards the north-west, in cities like Manchester and Liverpool where you should expect a significant level of appreciation. To help you seek out property with appreciation potential, you should turn to property experts like RW Invest, who can help you secure a lucrative investment.
As a landlord, you can benefit from several tax reductions, such as interest on your mortgage or credit cards, maintenance costs, legal fees, property taxes and insurance. While these are not guaranteed, there is a good chance that these costs could be deducted from your outgoings, as well as benefitting from tax-free rental income.
You can also depreciate your property, as it is a tangible asset. This involves a deduction of costs associated with buying and updating a property. These reductions are distributed across the period of useful life, which is the time in which your property is in use.
Flexible working hours
While you may not realise that becoming a landlord is a job, it is actually one of the best ways to earn a living. This is because you can decide when you work, as well as how much responsibility you want to take on. For example, you could choose to take on hands-on investment and do everything yourself such as taking rent, repairs and dealing with complaints.
Alternatively, you could choose to take on a hands-off approach and instead hire a property manager who can deal with all property-related tasks. This way you will have more time on your hands, while also benefitting from the substantial amount of income.