Finding Tenants

Having given much thought to the purchase of a property to let, you will also need to look at the possible sources of the tenant for your property. The tenant is the key to your future income, so must be chosen very carefully. When you chose the property, you will have formed an idea of the type of person that you are looking for; professional, student, working, on benefits or retired.

There are a number of ways to find the right tenant for your property, some examples are shown below:

The Public Sector

One source of income is the local authority or housing association. Your property will be taken off your hands under a long-term contract and you will receive a rental income paid directly for this period, with agreed increases. The rent that you'll get will be lower than a comparable market rent, however, in return you'll be getting full management and a secure income.

Student Lets

Many letting agencies and landlords are not keen on letting to students - there is the perception that students tend to live a lifestyle guaranteed to increase the wear and tear on a property, and that they will not look after it properly.

However, if dealt with in the right way, student lets can be profitable. Rent is guaranteed by confirmation that they are a genuine student with references from parents, who act as guarantors. Although students quite often want property for only eight or nine months, they are usually required to sign an agreement for a whole year.

There can be a lot of money made from student lets - however, the tenancy will have to be watched over more carefully than other lets, purely because of the nature of student lifestyle.

Letting Agents

There are many advantages in using an agent:

1. They will already have tenants on their books
2. They are likely to be experienced
3. They can provide you with a tenancy agreement
4. They can vet tenants properly before the tenancy is signed
5. They can provide a service after the property is let

However, the disadvantage of course, is that they will charge you for all this - and their fees can vary enormously. A typical management fee might be 10-15% of the rent, although there are many different levels of services. You will need to make sure that you are clear about what they will charge and how much you'll be left with afterwards. In addition, they may want to charge a slightly lower rent in order to attract tenants and get the property filled, so you will also need to take this into your financial calculations.