Tenant Horror Stories

[macoto_]

Hey All,
I've recently had some shares vest and so I've got a decent deposit for a place but I'm currently based in Australia (I'm a UK citizen). I'm looking to get into letting and was wondering if it's worth going the letting route and having tenants or just get somewhere and get some family in there.

Do you have any horror stories that would put me off the tenant option?

 

[Barny]

Hi Macoto,

In this first instance and therefore forgetting who would live there. If you're based in Australia, how would you plan on purchasing the property? Do you have friends / family in the UK you could trust to view on your behalf or would you buy "blind"? (By "blind" I mean purely using photos to make your decision, ie, Rightmove, Zoopla, etc.)

Secondly, I expect at some point every landlord will have some form of horror story, I have 3 BTL's at this moment in time, in 1 house the same lady has lived there with her son for 8 years and we've had no problems.
In another house, my first tenant was fine until 1 weekend when he went away and let his 21 year old son have a surprise bday party for his 16 year old sister, a window was smashed, an original sash window with vintage sash cord had the sash slashed and an external tiled concrete window ledge had a sledgehammer taken to it, needless to say they didn't stay much longer and he didn't have much left of his deposit, the following 2 tenants over the last 3 years have all been fine.
In my final property, a 1 bed flat, the first 3 months were all ok but then the tenant lost his job and couldn't afford to pay the rent so had to terminate his agreement by mutual consent.

Finally, the difference between letting to a stranger through an agent, or privantely, than letting to family is that at the end of the day it's still your house and you will still have to maintain it. Family may be more reliable in keeping the place well looked after but that may be down to their age and mentality, after all, I expect an aunt or uncle in their 30's or 40's will look after it far batter than 1 or 2 cousins in their early 20's.

Personally, if this is to be your first BTL venture then I'd rent through an agent and have them find your tenant and manage the property. Make it clear from the outset you'll be a fully "hands-off" landlord, as in you won't get involved with the upkeep or maintenance, etc, because you're not local and let them do everything for you. Most agents generally charge an initial fee for their services for the inventory, tenant search, credit / reference checks, etc and will then charge a 10% or so monthly fee. Depending on your deposit, with the right property and mortgage, you could still make a healthy profit after all fees.

Good luck with it and keep us updated with how you get on. There's plenty of other threads here that will give advice on areas to look at, BTL tips, etc so worth having a full read through as and when you can.

 

[macoto_]

Hi Barny,
I live and work in Australia at the moment and head back to the UK at least once a year. I'm planning on heading back for Easter to catch up with friends and family and as I've just got the windfall from some shares then I thought now was the time to be thinking about what to do with it. I'm currently doing the rounds on property sites and will be arranging some viewings once I'm over the jet lag.

It sounds like tenants can be a mixed bag and I think your advice about getting an agent in would be ideal given that I'll certainly have to be hands-off until I move back to the UK permanently. Do you use agents for your 3 BTLs or do you self manage?

As for my family, thankfully it'd be one of my sisters and accompanying family who'd move in so I know they'd keep it well looked after and probably be keen to do it up so I'll have to perhaps have a chat with some letting agents and see how it goes.

Thanks for you advice, I'll check out more of the threads here and keep posting updates.

 

[Barny]

You could be back pretty soon then, whereabouts would you think you'd be looking?

I self manage my 2 houses and use an agent for the flat. The main reason for this is that flats will generally have a higher turnover of tenant because its cheaper than a house rent so professional singles or young couples use it as a stepping stone while saving or as their first home, so for that reason I use an agent, also for repeat tenants I get a discount so would save me the hassle of doing it myself every 6/12 months, depending on how long they stay.

If you were to have family stay there, you'd have to consider what you'd be wanting to charge rent-wise. Obviously you'd want enough to cover your mortgage but you may have a guilty conscience if charging your family full market rate whereas you wouldn't have that if using an agent and having a stranger there.

Also, whether now or for the future, if renting privately always reduce the rent a little from the market rate as you won't be paying out for agent fees and potential tenants will see that you're not as greedy. For example, I charge £650/m for my house instead of market rate of £700/m because if using an agent I'd pay 10% fee plus vat (£84/m) and I'd only get £616/m so tenant is saving £50/m and I'm making £34/m extra so everyone's a winner! :beer:

 

[macoto_]

Yeah it's not long now but I'm dreading sitting on a plane for 24 hours!
My family are based in the South West, in between Bath & Bristol so I'd be looking for somewhere that's either in one of those places (but prices are generally quite high) or somewhere a bit further out that's got good access.

If I did move family in then yeah I'd probably only cover the mortgage and wouldn't want to charge full rate.

Thanks for your advice on getting an agent depending on the kind of property that I go for, it's little tidbits like that that make this forum invaluable!