Purchase The Right Rental Property
If you’re a prospective landlord interested in buy to let, then location is an important consideration. The biggest rental demand is in those areas with a high concentration of offices, shops, close proximity to transport links, hotels, bars and beaches. The benefit of purchasing in these areas also means you’re in a good position to ask for a higher rent. Finding a property with plenty of light and space will also work in your favour, budget permitting, of course. Additionally, the property should be furnished with modern fittings and equipped with good appliances. Also remember cracked tiles, unnecessary clutter, and a living room that looks like a furniture cemetery will only serve to scare off potential tenants.
Find a Trustworthy Tenant
This factor is possibly the most important of all. A crucial requirement is to draw up a rental agreement specifying the conditions agreed upon, and the method as well as frequency of payment. Also compile an inventory of the contents of your property.
The Importance of a Reference Check
No one feels comfortable renting out their property to someone who looks sketchy or cagey. You obviously don’t want to discover your tenant is untrustworthy, or worse still, may cause criminal damage to your property and contents that far exceeds their deposit liability and then ups and leaves! Asking for reference letters from their employer as well as a copy of their last three payslips to ensure they’re in a position to meet the monthly payments, is also a good idea. If after all is said and done there’s still something that doesn’t feel right, or you’re not convinced, rule this person out. Understand that a bad tenant can sink your entire investment.
Build a Good Relationship with Your Tenant
A happy tenant means a happy landlord, so don’t try to haggle over utility bills – any person whether Maltese or foreign living in your rented accommodation should benefit from the residential tariff with full eco reductions applicable. Also, make sure everything is properly maintained and if anything needs to be repaired get it fixed – immediately. If you want to see whether the property is being well kept, you can arrange to personally collect the rent every month. However, do so diplomatically and don’t make it obvious you’re inspecting the place, because it might make them feel uneasy and break any built trust. Remember although it is your property, it is their home, albeit temporarily.
And Last, but not least:
- Do ensure your property is properly insured
- Budget 10% of the rent each year to replace worn-out fixtures, fittings and furnishings
- Don’t assume the property will always be occupied
- Be sure that you comply with all the legal requirements expected from you as a landlord, especially for a VAT and tax perspective.