David Lawrenson - Successful Property Letting

SUCCESSFUL
PROPERTY LETTING

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www.constablerobinson.com

HOW TO MAKE MONEY
IN BUY-TO-LET

David Lawrenson

Constable & Robinson Ltd

5556 Russell Square

London

WC1B 4HP

www.constablerobinson.com

First published in the UK 2005

This new completely revised and updated edition published by Right Way,
an imprint of Constable & Robinson, 2013

Copyright David Lawrenson 2005, 2013

All rights reserved. This book is sold subject to the condition that it shall not, by way of trade or otherwise, be lent, re-sold, hired out or otherwise circulated in any form of binding or cover other than that in which it is published and without a similar condition including this condition being imposed on the subsequent purchaser.

Every effort has been made to provide up-to-date text but the publishers cannot accept any liability for errors, omissions or changes in detail or for any consequences arising from the use of information contained herein.

A copy of the British Library Cataloguing in Publication Data is available from the British Library

ISBN: 978-0-7160-2356-2
eISBN: 978-0-7160-2357-9

Printed and bound in the EU

1 3 5 7 9 10 8 6 4 2

Cover design: www.simonlevyassociates.co.uk ;
Cover photograph: Alamy

To Dagmar Svehlik, my partner, for her fantastic love and support, to Alex, our son, and to my parents.

Thanks to all those who have taken time to comment on the good work that we try to do at LettingFocus and to all those who have shared their experiences of residential property investment and letting over the years. Even though I have been doing this for a long time, I sometimes still learn something new including a tip from Westways Striker Lee Slater. (Never do I step outside the goal area with ball in hand!)

Special regards to Richard Bowser, Tom Entwistle and Tessa Shepperson true gurus, whose knowledge of the many facets of property is always impressive.

Also, thanks to Judith Mitchell, my tirelessly good editor at Constable and to the Elliot brothers, who, in 2004 showed a unique and insightful faith in the original manuscript. I think their faith was fully rewarded.

After university and his MBA at Cass (formerly City University) Business School, David Lawrenson worked in the financial services industry as an internal consultant and project manager whilst moonlighting as a residential landlord.

In 2002, he left to become a full-time property investor. Then in 2005, the first edition of Successful Property Letting How to Make Money in Buy-to-Let came out and became the UKs top-selling property book.

Lawrensons views on the private rented sector are quoted regularly in national newspapers like The Times, Independent and Daily Telegraph and in many specialist property magazines and on buy-to-let websites.

He is a regular speaker at trade shows and for public and private organisations and trade associations and he runs a thriving consultancy business which helps banks, building societies, investment funds, letting agents, local authorities and housing associations develop and market their products and services for the buy-to-let and landlord markets.

He has advised the London Assembly and spoken at the Council of Mortgage Lenders.

Lawrenson also has a low-cost seminar programme and a one-to-one consultancy service for people wishing to get into buy-to-let for the first time as well as for more experienced landlords and investors. His website and blog are at .

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Over the years, many journalists and commentators have rather laughably predicted the demise of the private rented sector and of landlords fortunes, yet the sector continues to defy such predictions. Today, almost a fifth of residential property is in the private rented sector and the proportion is far higher in places like London.

Private landlords, who comply with the myriad of laws and regulations, behave ethically and buy the right types of properties at the right price and in the right areas, have continued to prosper.

In the future, there will be still more money to be made from letting private residential property and a lot of satisfaction to be gained from providing secure and comfortable accommodation for people to live in. And, of course, it is a great alternative or add-on to a traditional pension.

But as the government intervenes ever more in the private rented sector and as sharks and unethical operators continue to be attracted by the profits available from advising landlords, the risks for those landlords who dont know what they are doing have become ever greater.

In this new edition, I explain how anyone thinking of becoming a private landlord for the first time can make a success of it. But the book is also intended for established landlords too. Even those with years of experience and big portfolios will find plenty of useful tips here.

The book has been updated throughout. The sections covering buying at auctions, buying repossessed property, how to get the best landlords insurance, and reference checking potential tenants have all been revised but there have been other changes on almost every page too adding more tips and common sense advice throughout.

Some of the major revisions cover the following areas:

Mortgage availability has got a lot harder. Some lenders criteria are as hard to fathom and seem as illogical as ever. I will explain how the financing landscape has changed and how landlords can still get great financing deals.

Huge changes have happened around energy saving issues that landlords need to know about so that they can still legally let their properties once the Green Deal really kicks in.

The first pan-borough licensing scheme has started. Expect more to follow. And there have also been changes for houses in multiple occupation, some of which mean it is now harder to convert a property to an HMO in some areas. I will explain the latest changes.

More hurdles and more severe penalties have been introduced on tenancy deposit schemes to catch out the unwary and uninformed.

The Government seems to be trying to do their best to discourage the few remaining landlords who are still trying to let to those people whose housing options are fewest. I explain the recent changes coming from Westminster, including the Universal Credit system. I show how it is still possible to make these types of lets work for you, if you know what you are doing.

As usual, it is All Change here. I explain the latest situation in the handy Tax chapter.

As ever, in the book, I do not hold back from challenging those who provide services to the private rented sector to do better and I am often critical of government policy, which is too often muddled and contradictory.