When you have the funds to invest in a second property, it can be incredibly exciting. You now have a second home to decorate and keep in line with the latest trends. However, many people invest in a second property not to live in but to rent out in order to make an additional income. This can be very profitable but there are some hidden costs that you need to be aware of before splashing out. This is why a lot of people consider hiring Southsea Letting Agents to manage everything.
To prove this to you, we thought we’d look at some of the hidden costs involved in renting out your second property. Read on to hear more about this.
Managing the property
Some landlords are active and will manage the property by themselves. Of course, if you’re hoping to make this into a side hustle with very little input from yourself, you might want to find a letting agent to manage the property. While this can be useful, it can also be very expensive as they’ll deal with finding tenants, organising repairs and more. Make sure to think carefully about the cost of having your property professionally managed. You can also have a look at things such as inventory checks as a cheaper alternative.
Keeping it furnished
If you have already been living in your second property, you might have already furnished it. But, is this furniture suitable for tenants or would you rather include some other furniture? Furnishing a property is never going to be cheap and so you need to account for this cost before you rent it out to a new tenant. On top of that, you’ll need to replace any broken furniture, and this is going to increase the cost.
Safety first
Many landlords get into the property market because they think that it will be an easy way to make an additional income. However, the government has put many rules and regulations in place to make renting safer for tenants. For this reason, you’ll need to make sure that the property is safe to live in and that you have the documentation to back it up.
For example, you’ll need to get an electrical certificate which you can book at electricalsafetycertificate.co.uk which is a government endorsed website. Their reports will showcase that your property is safe to live in and that you’re following government guidance. While companies like this one offer a cost-effective service, you’ll still need to account for this cost.
Legal fees
Finally, you should know that there are more legal fees involved in renting out your second property than you might realise. You’ll need to pay for the creation of a tenancy agreement, and you’ll need to enter a safe deposit scheme which is required by law. Other legal fees involve obtaining an energy certificate and potentially setting up a limited company. Make sure that you can cover all these costs.
Get started
While there are many hidden costs involved with renting out your second property, you can make a lot of money if you do it right. Make sure that you’re adhering to any laws set out for landlords if you want to make this a sustainable project. Hopefully, you’ll be able to cover the costs and get that money back over time.
[disclosure*]
