In this July 17, 2013 article of Your Money by Simon Thompson, director of Accommodationforstudents.com, offers some essential advice.
Renting to students can be a profitable venture but it pays to be prepared.
1. Do your research first
Many prospective student landlords see the pound signs clocking up,
but often fail to see the downsides of running a property business. A
property business is just that - a business. All the general rules of
running and marketing a business apply to student landlords as much as
they do any other business. The key to a successful business is
understanding your customers and providing them with the right products
and services at a reasonable price. Student letting is about providing
decent property in the right location at the right rent.
Running a successful student letting business offers no easy way to
riches. Student landlords work long hours sourcing, renovating and
maintaining their property. After hours, someone needs to keep up with
ever-changing letting laws and complete the accounts and tax returns.
Before buying a property, every prospective student landlord should
sit down and make some tough decisions - the first two are where to
invest and who will take on the day-to-day management of the rental
business.
2. Pick the right property
Student lets is a growing market which has attracted many investors
who have recognised it as an opportunity that can deliver yields of up
to 10%, far greater than other property type. However, sourcing student
property can go against the grain for property investors who do not
realise the needs of their market. Students like to share in groups of
generally three or more. The ideal student let sleeps at least three
people, which puts many standard homes with three bedrooms in the frame.
However, with the profitability of a student let determined by the
number of bed spaces, larger Houses in Multiple Occupation (HMOs) which
benefit from multiple rents, can often seem like the most attractive
option.
Property investors need to bear in mind financial considerations such
as buying a property that will appreciate in value over time and that
is the right type of home in the right location. Investors need to weigh
up their options and calculate the potential rental yield, rent cover
and loan-to-value to establish whether a property is worth pursuing.
3. Keep good financial records
A landlord also has a legal obligation to keep good financial records
and to declare any profits to the tax man. Keeping good financial
records from the start of a property business is vital. Failing to
keep track of income and expenses is likely to lead to paperwork
spiralling out of control. Landlords can also face unnecessary fines and
penalties for failing to keep good business records and making mistakes
on tax returns. Worst of all, poor records can lead to paying too
little or too much tax.
For individuals, the options are sole purchaser, buying as joint
tenants or tenants in common. When considering the best tax-effective
ownership for a property, always look at the bigger picture and how your
decision will impact other tax issues.
4. Get ready for rental
Most landlords, especially those running houses in multiple
occupation (HMOs), have lists of basic tasks they have to consider. Some
of the most important include:-
Timing - student
lets revolve around their own calendar and the academic year, which runs
from September through to July. The peak viewing times are January to
March.
Insurance - ensure you have sufficient buildings, contents and landlord insurance.
Get Accredited -
Accreditation schemes aim to let landlords demonstrate that their
properties comply with legal standards and that they operate good
management practices.
Finish & Furnishings -The starting point for a student let is figuring out what a student wants from their home and simply giving it to them.
Get an Inventory
- Make sure you get an inventory report to avoid any disputes at the
end of the tenancy term: positive referrals and reputation are very
important.
Screen your tenants - Screen your tenants
and make sure all the paperwork is in place. Take time to explain
everything carefully. Let tenants know the procedure for reporting
maintenance issues.
5. Keep the tenants happy and the rent rolling in
A landlord's work is never done and certainly does not stop when the
tenants move in - and like most things, tasks expand to fill the time
available. Unless you have an effective tenant management system, you
will find yourself rushing around dealing with complaints, sorting out
repairs and chasing rents. This is all part of running a property
business and should be expected. Respect your tenants and they will
respect you.
You can also decrease the chances of tenants sliding
into arrears by setting out a rent policy and by firmly enforcing the
rules. Trying to tie rent days with pay days can be a good idea.
6. A bonus tip!
Take your tenants for a beer! A good open relationship from the start can make all the difference.
Author: Simon Thompson
"There is no great love in investors' minds for Europe. However, we believe Europe will prove itself to investors again.
"Last year Europe faced existential currency and political risks,
endless emergency summits, policy volte faces, and a general sense of
teetering on the edge of an abyss.
"Since the low on June 1 last year, the MSCI Europe ex-UK index is up
43% in sterling terms. Yet the general feeling of mistrust lingers.
"Draghi's ECB is possibly the only European institution with market
credibility. The market rally has climbed a wall of worry including the
left-field results of the Italian election, and the farce that was the
Cypriot bail-out. But climb it did. What is required to see markets
climb further?
"The good news is that we don't need to love Europe in order to invest in it.
"At current levels valuations are so cheap on a cyclically adjusted
basis that I believe the environment simply needs to be ‘less bad' for
Europe to be an attractive case. We could point out that Europe is
chock-full of world class companies, which have international exposure,
and are (thankfully) run by first-class managers not politicians, but
that has been the case for a while and it hasn't persuaded investors
thus far.
"As investors we have one role - that is, to find under-valued assets,
whatever those assets might be. Most appear to be persuaded that bonds
are intrinsically over-valued. Equally, many seem persuaded that
equities are, at this point, a cheap asset class.
"What fewer seem to accept is the fact that Europe today is the global
value play, and within Europe itself, there are areas of the market
which sit at generationally low valuation levels.
"On price/earnings adjusted on a 10-year through-cycle basis,
Pan-Europe is 25% cheap, Economic Monetary Union block is 37% cheap, but
Italy and Spain are currently sitting in the range of 50-60% below
their long-term average Shiller PEs2. So, after 5 or so years of
economic trauma, with car sales, TV advertising, and property markets
falling in some cases 50% plus, these markets are trading at trough
multiples on trough earnings.
"At Invesco Perpetual we are pragmatic and open-minded as to the
sources of sustainable dividend income across Europe. Valuation, yield
and dividend growth opportunities in Europe are in our view attractive,
but not necessarily in the ‘traditional' income sector. Where we
currently see most potential is financials, the periphery and selected
cyclicals where dividend revisions are improving, and valuations and
pay-out ratios are low.
"Crucially, expectations in some of the cheapest areas of the market
are modest if not outright pessimistic. Positive momentum comes in two
ways; good things getting better, and bad things getting less bad.
"Ultimately we believe Europe will prove itself to be loveable again." -
See more at:
http://www.investortoday.co.uk/news_features/investors-told3A-dont-write-off-europe#sthash.qumMNepN.dpuf
"There is no great love in investors' minds for Europe. However, we believe Europe will prove itself to investors again.
"Last year Europe faced existential currency and political risks,
endless emergency summits, policy volte faces, and a general sense of
teetering on the edge of an abyss.
"Since the low on June 1 last year, the MSCI Europe ex-UK index is up
43% in sterling terms. Yet the general feeling of mistrust lingers.
"Draghi's ECB is possibly the only European institution with market
credibility. The market rally has climbed a wall of worry including the
left-field results of the Italian election, and the farce that was the
Cypriot bail-out. But climb it did. What is required to see markets
climb further?
"The good news is that we don't need to love Europe in order to invest in it.
"At current levels valuations are so cheap on a cyclically adjusted
basis that I believe the environment simply needs to be ‘less bad' for
Europe to be an attractive case. We could point out that Europe is
chock-full of world class companies, which have international exposure,
and are (thankfully) run by first-class managers not politicians, but
that has been the case for a while and it hasn't persuaded investors
thus far.
"As investors we have one role - that is, to find under-valued assets,
whatever those assets might be. Most appear to be persuaded that bonds
are intrinsically over-valued. Equally, many seem persuaded that
equities are, at this point, a cheap asset class.
"What fewer seem to accept is the fact that Europe today is the global
value play, and within Europe itself, there are areas of the market
which sit at generationally low valuation levels.
"On price/earnings adjusted on a 10-year through-cycle basis,
Pan-Europe is 25% cheap, Economic Monetary Union block is 37% cheap, but
Italy and Spain are currently sitting in the range of 50-60% below
their long-term average Shiller PEs2. So, after 5 or so years of
economic trauma, with car sales, TV advertising, and property markets
falling in some cases 50% plus, these markets are trading at trough
multiples on trough earnings.
"At Invesco Perpetual we are pragmatic and open-minded as to the
sources of sustainable dividend income across Europe. Valuation, yield
and dividend growth opportunities in Europe are in our view attractive,
but not necessarily in the ‘traditional' income sector. Where we
currently see most potential is financials, the periphery and selected
cyclicals where dividend revisions are improving, and valuations and
pay-out ratios are low.
"Crucially, expectations in some of the cheapest areas of the market
are modest if not outright pessimistic. Positive momentum comes in two
ways; good things getting better, and bad things getting less bad.
"Ultimately we believe Europe will prove itself to be loveable again." -
See more at:
http://www.investortoday.co.uk/news_features/investors-told3A-dont-write-off-europe#sthash.qumMNepN.dpuf
"There is no great love in investors' minds for Europe. However, we believe Europe will prove itself to investors again.
"Last year Europe faced existential currency and political risks,
endless emergency summits, policy volte faces, and a general sense of
teetering on the edge of an abyss.
"Since the low on June 1 last year, the MSCI Europe ex-UK index is up
43% in sterling terms. Yet the general feeling of mistrust lingers.
"Draghi's ECB is possibly the only European institution with market
credibility. The market rally has climbed a wall of worry including the
left-field results of the Italian election, and the farce that was the
Cypriot bail-out. But climb it did. What is required to see markets
climb further?
"The good news is that we don't need to love Europe in order to invest in it.
"At current levels valuations are so cheap on a cyclically adjusted
basis that I believe the environment simply needs to be ‘less bad' for
Europe to be an attractive case. We could point out that Europe is
chock-full of world class companies, which have international exposure,
and are (thankfully) run by first-class managers not politicians, but
that has been the case for a while and it hasn't persuaded investors
thus far.
"As investors we have one role - that is, to find under-valued assets,
whatever those assets might be. Most appear to be persuaded that bonds
are intrinsically over-valued. Equally, many seem persuaded that
equities are, at this point, a cheap asset class.
"What fewer seem to accept is the fact that Europe today is the global
value play, and within Europe itself, there are areas of the market
which sit at generationally low valuation levels.
"On price/earnings adjusted on a 10-year through-cycle basis,
Pan-Europe is 25% cheap, Economic Monetary Union block is 37% cheap, but
Italy and Spain are currently sitting in the range of 50-60% below
their long-term average Shiller PEs2. So, after 5 or so years of
economic trauma, with car sales, TV advertising, and property markets
falling in some cases 50% plus, these markets are trading at trough
multiples on trough earnings.
"At Invesco Perpetual we are pragmatic and open-minded as to the
sources of sustainable dividend income across Europe. Valuation, yield
and dividend growth opportunities in Europe are in our view attractive,
but not necessarily in the ‘traditional' income sector. Where we
currently see most potential is financials, the periphery and selected
cyclicals where dividend revisions are improving, and valuations and
pay-out ratios are low.
"Crucially, expectations in some of the cheapest areas of the market
are modest if not outright pessimistic. Positive momentum comes in two
ways; good things getting better, and bad things getting less bad.
"Ultimately we believe Europe will prove itself to be loveable again." -
See more at:
http://www.investortoday.co.uk/news_features/investors-told3A-dont-write-off-europe#sthash.qumMNepN.dpuf
"There is no great love in investors' minds for Europe. However, we believe Europe will prove itself to investors again.
"Last year Europe faced existential currency and political risks,
endless emergency summits, policy volte faces, and a general sense of
teetering on the edge of an abyss.
"Since the low on June 1 last year, the MSCI Europe ex-UK index is up
43% in sterling terms. Yet the general feeling of mistrust lingers.
"Draghi's ECB is possibly the only European institution with market
credibility. The market rally has climbed a wall of worry including the
left-field results of the Italian election, and the farce that was the
Cypriot bail-out. But climb it did. What is required to see markets
climb further?
"The good news is that we don't need to love Europe in order to invest in it.
"At current levels valuations are so cheap on a cyclically adjusted
basis that I believe the environment simply needs to be ‘less bad' for
Europe to be an attractive case. We could point out that Europe is
chock-full of world class companies, which have international exposure,
and are (thankfully) run by first-class managers not politicians, but
that has been the case for a while and it hasn't persuaded investors
thus far.
"As investors we have one role - that is, to find under-valued assets,
whatever those assets might be. Most appear to be persuaded that bonds
are intrinsically over-valued. Equally, many seem persuaded that
equities are, at this point, a cheap asset class.
"What fewer seem to accept is the fact that Europe today is the global
value play, and within Europe itself, there are areas of the market
which sit at generationally low valuation levels.
"On price/earnings adjusted on a 10-year through-cycle basis,
Pan-Europe is 25% cheap, Economic Monetary Union block is 37% cheap, but
Italy and Spain are currently sitting in the range of 50-60% below
their long-term average Shiller PEs2. So, after 5 or so years of
economic trauma, with car sales, TV advertising, and property markets
falling in some cases 50% plus, these markets are trading at trough
multiples on trough earnings.
"At Invesco Perpetual we are pragmatic and open-minded as to the
sources of sustainable dividend income across Europe. Valuation, yield
and dividend growth opportunities in Europe are in our view attractive,
but not necessarily in the ‘traditional' income sector. Where we
currently see most potential is financials, the periphery and selected
cyclicals where dividend revisions are improving, and valuations and
pay-out ratios are low.
"Crucially, expectations in some of the cheapest areas of the market
are modest if not outright pessimistic. Positive momentum comes in two
ways; good things getting better, and bad things getting less bad.
"Ultimately we believe Europe will prove itself to be loveable again." -
See more at:
http://www.investortoday.co.uk/news_features/investors-told3A-dont-write-off-europe#sthash.qumMNepN.dpuf
"There is no great love in investors' minds for Europe. However, we believe Europe will prove itself to investors again.
"Last year Europe faced existential currency and political risks,
endless emergency summits, policy volte faces, and a general sense of
teetering on the edge of an abyss.
"Since the low on June 1 last year, the MSCI Europe ex-UK index is up
43% in sterling terms. Yet the general feeling of mistrust lingers.
"Draghi's ECB is possibly the only European institution with market
credibility. The market rally has climbed a wall of worry including the
left-field results of the Italian election, and the farce that was the
Cypriot bail-out. But climb it did. What is required to see markets
climb further?
"The good news is that we don't need to love Europe in order to invest in it.
"At current levels valuations are so cheap on a cyclically adjusted
basis that I believe the environment simply needs to be ‘less bad' for
Europe to be an attractive case. We could point out that Europe is
chock-full of world class companies, which have international exposure,
and are (thankfully) run by first-class managers not politicians, but
that has been the case for a while and it hasn't persuaded investors
thus far.
"As investors we have one role - that is, to find under-valued assets,
whatever those assets might be. Most appear to be persuaded that bonds
are intrinsically over-valued. Equally, many seem persuaded that
equities are, at this point, a cheap asset class.
"What fewer seem to accept is the fact that Europe today is the global
value play, and within Europe itself, there are areas of the market
which sit at generationally low valuation levels.
"On price/earnings adjusted on a 10-year through-cycle basis,
Pan-Europe is 25% cheap, Economic Monetary Union block is 37% cheap, but
Italy and Spain are currently sitting in the range of 50-60% below
their long-term average Shiller PEs2. So, after 5 or so years of
economic trauma, with car sales, TV advertising, and property markets
falling in some cases 50% plus, these markets are trading at trough
multiples on trough earnings.
"At Invesco Perpetual we are pragmatic and open-minded as to the
sources of sustainable dividend income across Europe. Valuation, yield
and dividend growth opportunities in Europe are in our view attractive,
but not necessarily in the ‘traditional' income sector. Where we
currently see most potential is financials, the periphery and selected
cyclicals where dividend revisions are improving, and valuations and
pay-out ratios are low.
"Crucially, expectations in some of the cheapest areas of the market
are modest if not outright pessimistic. Positive momentum comes in two
ways; good things getting better, and bad things getting less bad.
"Ultimately we believe Europe will prove itself to be loveable again." -
See more at:
http://www.investortoday.co.uk/news_features/investors-told3A-dont-write-off-europe#sthash.qumMNepN.dpuf
"There is no great love in investors' minds for Europe. However, we believe Europe will prove itself to investors again.
"Last year Europe faced existential currency and political risks,
endless emergency summits, policy volte faces, and a general sense of
teetering on the edge of an abyss.
"Since the low on June 1 last year, the MSCI Europe ex-UK index is up
43% in sterling terms. Yet the general feeling of mistrust lingers.
"Draghi's ECB is possibly the only European institution with market
credibility. The market rally has climbed a wall of worry including the
left-field results of the Italian election, and the farce that was the
Cypriot bail-out. But climb it did. What is required to see markets
climb further?
"The good news is that we don't need to love Europe in order to invest in it.
"At current levels valuations are so cheap on a cyclically adjusted
basis that I believe the environment simply needs to be ‘less bad' for
Europe to be an attractive case. We could point out that Europe is
chock-full of world class companies, which have international exposure,
and are (thankfully) run by first-class managers not politicians, but
that has been the case for a while and it hasn't persuaded investors
thus far.
"As investors we have one role - that is, to find under-valued assets,
whatever those assets might be. Most appear to be persuaded that bonds
are intrinsically over-valued. Equally, many seem persuaded that
equities are, at this point, a cheap asset class.
"What fewer seem to accept is the fact that Europe today is the global
value play, and within Europe itself, there are areas of the market
which sit at generationally low valuation levels.
"On price/earnings adjusted on a 10-year through-cycle basis,
Pan-Europe is 25% cheap, Economic Monetary Union block is 37% cheap, but
Italy and Spain are currently sitting in the range of 50-60% below
their long-term average Shiller PEs2. So, after 5 or so years of
economic trauma, with car sales, TV advertising, and property markets
falling in some cases 50% plus, these markets are trading at trough
multiples on trough earnings.
"At Invesco Perpetual we are pragmatic and open-minded as to the
sources of sustainable dividend income across Europe. Valuation, yield
and dividend growth opportunities in Europe are in our view attractive,
but not necessarily in the ‘traditional' income sector. Where we
currently see most potential is financials, the periphery and selected
cyclicals where dividend revisions are improving, and valuations and
pay-out ratios are low.
"Crucially, expectations in some of the cheapest areas of the market
are modest if not outright pessimistic. Positive momentum comes in two
ways; good things getting better, and bad things getting less bad.
"Ultimately we believe Europe will prove itself to be loveable again." -
See more at:
http://www.investortoday.co.uk/news_features/investors-told3A-dont-write-off-europe#sthash.qumMNepN.dpuf
"There is no great love in investors' minds for Europe. However, we believe Europe will prove itself to investors again.
"Last year Europe faced existential currency and political risks,
endless emergency summits, policy volte faces, and a general sense of
teetering on the edge of an abyss.
"Since the low on June 1 last year, the MSCI Europe ex-UK index is up
43% in sterling terms. Yet the general feeling of mistrust lingers.
"Draghi's ECB is possibly the only European institution with market
credibility. The market rally has climbed a wall of worry including the
left-field results of the Italian election, and the farce that was the
Cypriot bail-out. But climb it did. What is required to see markets
climb further?
"The good news is that we don't need to love Europe in order to invest in it.
"At current levels valuations are so cheap on a cyclically adjusted
basis that I believe the environment simply needs to be ‘less bad' for
Europe to be an attractive case. We could point out that Europe is
chock-full of world class companies, which have international exposure,
and are (thankfully) run by first-class managers not politicians, but
that has been the case for a while and it hasn't persuaded investors
thus far.
"As investors we have one role - that is, to find under-valued assets,
whatever those assets might be. Most appear to be persuaded that bonds
are intrinsically over-valued. Equally, many seem persuaded that
equities are, at this point, a cheap asset class.
"What fewer seem to accept is the fact that Europe today is the global
value play, and within Europe itself, there are areas of the market
which sit at generationally low valuation levels.
"On price/earnings adjusted on a 10-year through-cycle basis,
Pan-Europe is 25% cheap, Economic Monetary Union block is 37% cheap, but
Italy and Spain are currently sitting in the range of 50-60% below
their long-term average Shiller PEs2. So, after 5 or so years of
economic trauma, with car sales, TV advertising, and property markets
falling in some cases 50% plus, these markets are trading at trough
multiples on trough earnings.
"At Invesco Perpetual we are pragmatic and open-minded as to the
sources of sustainable dividend income across Europe. Valuation, yield
and dividend growth opportunities in Europe are in our view attractive,
but not necessarily in the ‘traditional' income sector. Where we
currently see most potential is financials, the periphery and selected
cyclicals where dividend revisions are improving, and valuations and
pay-out ratios are low.
"Crucially, expectations in some of the cheapest areas of the market
are modest if not outright pessimistic. Positive momentum comes in two
ways; good things getting better, and bad things getting less bad.
"Ultimately we believe Europe will prove itself to be loveable again." -
See more at:
http://www.investortoday.co.uk/news_features/investors-told3A-dont-write-off-europe#sthash.qumMNepN.dpuf
"There is no great love in investors' minds for Europe. However, we believe Europe will prove itself to investors again.
"Last year Europe faced existential currency and political risks,
endless emergency summits, policy volte faces, and a general sense of
teetering on the edge of an abyss.
"Since the low on June 1 last year, the MSCI Europe ex-UK index is up
43% in sterling terms. Yet the general feeling of mistrust lingers.
"Draghi's ECB is possibly the only European institution with market
credibility. The market rally has climbed a wall of worry including the
left-field results of the Italian election, and the farce that was the
Cypriot bail-out. But climb it did. What is required to see markets
climb further?
"The good news is that we don't need to love Europe in order to invest in it.
"At current levels valuations are so cheap on a cyclically adjusted
basis that I believe the environment simply needs to be ‘less bad' for
Europe to be an attractive case. We could point out that Europe is
chock-full of world class companies, which have international exposure,
and are (thankfully) run by first-class managers not politicians, but
that has been the case for a while and it hasn't persuaded investors
thus far.
"As investors we have one role - that is, to find under-valued assets,
whatever those assets might be. Most appear to be persuaded that bonds
are intrinsically over-valued. Equally, many seem persuaded that
equities are, at this point, a cheap asset class.
"What fewer seem to accept is the fact that Europe today is the global
value play, and within Europe itself, there are areas of the market
which sit at generationally low valuation levels.
"On price/earnings adjusted on a 10-year through-cycle basis,
Pan-Europe is 25% cheap, Economic Monetary Union block is 37% cheap, but
Italy and Spain are currently sitting in the range of 50-60% below
their long-term average Shiller PEs2. So, after 5 or so years of
economic trauma, with car sales, TV advertising, and property markets
falling in some cases 50% plus, these markets are trading at trough
multiples on trough earnings.
"At Invesco Perpetual we are pragmatic and open-minded as to the
sources of sustainable dividend income across Europe. Valuation, yield
and dividend growth opportunities in Europe are in our view attractive,
but not necessarily in the ‘traditional' income sector. Where we
currently see most potential is financials, the periphery and selected
cyclicals where dividend revisions are improving, and valuations and
pay-out ratios are low.
"Crucially, expectations in some of the cheapest areas of the market
are modest if not outright pessimistic. Positive momentum comes in two
ways; good things getting better, and bad things getting less bad.
"Ultimately we believe Europe will prove itself to be loveable again." -
See more at:
http://www.investortoday.co.uk/news_features/investors-told3A-dont-write-off-europe#sthash.qumMNepN.dpuf
Property
prices in prime central London increased again in July, up by 0.5%
month on month and so far in 2013, prices for the very best homes in
London have increased by 4.2%.
Singapore has been named one of the top destinations for Indian
property buyers in a list which includes Malaysia, Dubai, New York and
some UK cities, according to property consultancy Jones Lang LaSalle.