According to Landlord News, the average cost of maintaining a rental property sits at around 1% of the total property value. This might not seem like a large number, but it can quickly begin to eat into your rental income.
For example, if you’re renting out a property whose value is £250,000, then your expected annual maintenance costs will total at £2500. To return a good rental yield, this property’s monthly rent should be between £1400-£1500 consequently causing average maintenance costs to take a whopping 17% of your rental income.
When you’ve invested such a large sum of money into a property, you don’t want to lose such a high percentage on your return, but luckily there are plenty of ways that you can keep maintenance costs down. Kings Lettings want to explain how:
FOCUS ON PREVENTION
The most efficient method of keeping maintenance costs down is to focus your efforts on prevention by:
- Ensuring your property is in a good state of repair before commencing your search for tenants. Conduct a full inspection of your property and conduct repairs wherever needed
- Scheduling regular inspections to make sure maintenance is conducted as soon as the issue arises, and can be corrected swiftly
But there are other ways you can prevent maintenance costs from spiralling on your new rental property:
BE CHOOSY ABOUT YOUR TENANTS
For new landlords, it can be tempting to fill property vacancies quickly but it is far better to conduct thorough checks on prospective tenants to guarantee long term security.
Tenant screening will inform you if a tenant is likely to care for your property, keep it clean and tidy, and pay their rent on time, making you unlikely to fall behind on income that could be useful when paying maintenance costs. Irresponsible tenants can also cause damage beyond the usual wear-and-tear and therefore decrease the value of your property.
Always check the following information:
- Previous addresses and employment details for the previous 3 years
- Lifestyle choices that could impact the state of the property, for example smoking habits, whether they have pets, previous criminal convictions
- Their credit score
- Tenant references from previous landlords
- Whether they are looking for long or short term accommodation
It is even better for you or your letting agent to meet with your tenants before any decisions are made about their legitimacy.
INVEST IN ENERGY EFFICIENCY
Investing in modern and efficient boiler systems and white goods can decrease the amount you spend on property maintenance. This is because they are far less likely to break down or cause irreparable water damage by leaking.
Modern boilers also include built-in frost protection features which turn the boiler on if the water temperature is getting too low. This prevents the water from freezing which can break your boiler, or lead to burst pipes.
For more information on how to be more energy efficient as a landlord, visit our blog: 5 Ways to Make Your Rental Property More Energy Efficient.
CHOOSE COMPREHENSIVE INSURANCE POLICIES
Insurance is a non-negotiable part of being a landlord, and although this might seem like an added monthly cost, it can pay off when it comes to property maintenance. For example, always look for landlord insurance policies that include building insurance and accidental damage insurance.
- Building insurance: Covers the cost of rebuilding or repairing damage to the structure of your property in the case of a flood or fire
- Accidental damage insurance: Covers accidental damage caused to a rental property such as replacing the carpet or wallpaper after an accidental spillage
No matter how careful your tenants are, accidents can happen so it’s important to get yourself covered by the above insurance policies if you want to keep maintenance costs to a minimum.
Most landlord insurance policies won’t cover deliberate damage caused by tenants or damage caused by pets which reaffirms why it’s so important to choose responsible tenants for your property.
USE YOUR TAX BREAKS
Certain maintenance costs can be allowable for tax deductions if your rental income exceeds £1000.
- General maintenance and repair of the property (excluding home improvements and renovations)
- The cost of maintenance and repair services such as boiler repairs, cleaners and gardeners
In order to claim these expenses against your taxable income, you will need to keep a documented list, including invoices and receipts, as proof.
If you’re a first time landlord seeking further advice and guidance on how to manage and maintain your property investment in London, Reading, Maidenhead, Staines or Windsor, contact Kings Lettings today.
KINGS LETTINGS, 103 HIGH STREET, MAIDENHEAD, BERKSHIRE, SL6 1JX
Lettings and property management offices in London, Reading, Maidenhead, Staines & Windsor.
T: +44 (0)16 2863 2188 | E: MAIDENHEAD@KINGS-LETTINGS.CO.UK