Rental property is a lucrative investment, especially in London where the demand for such properties is always high. However, you may face challenges as you try to maximise your income with the traditional letting agreements. Some of the challenges that could threaten your income include:
· Fluctuation in rental rates
· Void periods
· Tenants refusing to pay rent as stipulated
Fortunately, you now have a buffer against the uncertainties – the answer is Guaranteed Rent. You get into a contract with a management company that deals with the day-to-day management while paying you an agreed amount each month. As an investor, you no longer worry about looking for tenants or chasing arrears. So, how does this arrangement assure you of income from that investment?
Earn Monthly Payments Throughout the Contract
The schemes typically cover from 1 year to 5 years. Throughout the contract, you receive a fixed monthly income, regardless of the property’s occupancy status. That means you won’t have to worry about the fact that the property may not be occupied, a tenant hasn’t paid rent, or fluctuation in rental rates. This agreement is laid out clearly in the contract, ensuring landlords can predict their earnings throughout the scheme.
The amount you receive depends on the evaluation of the property – management companies have experts for accurate property evaluation. Examples of the factors that determine the amount include the type of property in question, its location, and the prevailing rental rates. To get the best from this scheme, work with a company that assures you of favourable monthly rental rates. As a landlord, your ultimate goal should be to earn a stable and risk-free rental income. The predictability ensures you can plan your finances, including using the income to expand your rental property portfolio.
Covers Rent Arrears and Void Periods
At some point, your property won’t be occupied – these are the void periods. The property’s income is from the rent tenants pay – you won’t earn any income from it when there are no tenants. Landlords lose rental income while still having to cover expenses like mortgage payments, utility bills, and property maintenance – the financial burden can become too much for you. Now you have a way out as a landlord – the scheme continues to pay you even when the property is vacant.
Also, your property may have tenants, but some fail to pay rent at the right time. The defaults or payment delays can disrupt your income stream and create cash flow problems. At the same time, you may have to deal with costly legal battles to recover lost rent or evict the tenant in question. Now you have an easy way out with these arrears and the costs associated with chasing them – the company you work with should pay you the agreed amount while chasing the arrears on your behalf.
Reduce the Cost of Property Management
Managing that property also comes with its costs in addition to being a time-consuming affair – addressing maintenance requests, tenant disputes, and property damage can be expensive. You have to factor in these costs when calculating your monthly income. When you work with a reputable scheme provider, most of these costs are covered. So, you can plan with the income you receive from your scheme provider.
Take Advantage of Guaranteed Rent Property Management
This scheme assures you of fixed income from your property each month – it’s stipulated in the agreement. You don’t worry about void periods or rent arrears. Still, it reduces the cost of management while getting the stress off of your back. Work with Denhan International and maximise your rental income!
