REFRAMING YOUR MINDSET
Accidental landlording can lack the structure of a formal business. Of course it comes with legal responsibilities, but it's often a reactive response to tasks, rather than a proactive enterprise.
Transitioning to an active investor requires a shift in perspective, including:
- Clarifying your growth goals: Are you aiming for multiple properties, increased monthly income, or long-term capital growth? Setting a vision keeps you sharply focused.
- Educating yourself: Learning about market trends, financing options, and what makes a property a good investment will boost your confidence and abilities.
- Assembling a trusted professional team: Partnering with estate agents, financial advisors, and reliable tradespeople makes scaling a portfolio more efficient and hassle-free.
We’ll discuss this in more detail in later sections, but adopting a commercially minded approach will lead to wise decisions, greater returns, and a solid, long-term business.
OPTIMISING YOUR EXISTING PROPERTY
If your current rental property is the start of your investment career, reviewing its performance will jumpstart your skills in adding future buy-to-lets to your portfolio, so:
- Conduct a rent review: Get your property valued for sales and lettings, check if the rent reflects current market rates, and consider any improvements that could increase your income.
- Calculate yield and return on investment (ROI): Factor in all your expenses to determine your property’s performance. Can it fund your next investment, and should it stay in your portfolio?
- Analyse the local market: Assess whether any previous or upcoming neighbourhood developments will influence the demand for rental homes or the types of tenant moving in.
SETTING A CLEAR STRATEGY AND GOALS
Having clear objectives is essential for any business to grow. Direction and motivation come from laying out your rental portfolio goals, while following a clear strategy will make your plans reality. So:
- Define your financial targets: Decide how much income you want to generate, what level of capital growth you’re aiming for, and when you’d like to reach it.
- Research potential investment areas: Speak with local agents to identify streets and towns with strong rental demand and potential for capital appreciation.
- Explore different rental sectors: Would you prefer a diverse portfolio or to find a niche and perfect it? Think about families, couples, sharers, students, etc - which tenant groups appeal?
- Borrow wisely: Using a whole-of-market independent broker is key to finding the best mortgage deals, from big high street names to specialist buy-to-let lenders.
- Devise an exit strategy (even if you never use it): Will you sell, hand over the reins, or pass your portfolio on?
There’s something undeniably exciting about writing down your perfect outcomes for a business you’re proud of and love, so allow yourself to dream to see what your mind comes up with.
PROFESSIONALISING YOUR APPROACH
Growing a rental portfolio isn't just about bricks and mortar or tenants; it's a real business. And to have a business that works for you, instead of the other way around, it's good to get the basics right and:
- Grow your network: Develop strong relationships with local letting agents, reliable contractors (if you're self-managing), and essential professionals like a solicitor and accountant.
- Get organised: Either hire a skilled agent to manage your growing portfolio, or create solid systems for communicating with tenants, carrying out maintenance, and collecting rent.
Professionalising your approach is like having an insurance policy against the unexpected. And with your well-oiled operation, you'll minimise hassle and fire-fighting, and free up your time to expand.
EMBRACING CONTINUOUS LEARNING
The rental market and lettings law are rarely static, so it's vital to keep up with evolving legislation and tenant trends for continued success, not to mention avoiding penalties and fines. Sensible steps include:
- Attending industry events and seminars: Network with other investors and collect valuable tips and insights from experienced professionals.
- Reading books and articles on property investment: Expand your knowledge and stay ahead of market movements. Ask us if you’d like any recommendations for reading material.
- Joining online forums and communities: Engage with other landlords, share experiences and insights, and connect with a circle of like-minded entrepreneurs.
- Staying legally compliant: monitor the government's website for changes in legislation, not least the upcoming Renters Rights Bill that will affect England, Scotland and Wales in different ways.
Continuous learning helps you stay ahead of the curve and maximise your investments, but if you’d rather someone else made all the effort for you, we’d love to help you benefit from our expertise.
Ready to unlock the potential of a thriving rental portfolio?
Transitioning from an accidental landlord to an active investor is much easier with a positive, professional and proactive managing agent by your side.
If you’re looking to increase your portfolio of rental homes in Liverpool, call us on 0151 280 4047 or email us at This email address is being protected from spambots. You need JavaScript enabled to view it. for a chat about your goals and how we can help you achieve them.
