As 2022 draws to a close, landlords need to make sure they’re ready and prepared for the year ahead. Inflation and the current climate surrounding the cost of living will only further impact not only the housing market, but the nation as a whole in the near future. Given the current situation, it is crucial for landlords to be efficient in their planning for the future, and be up-to-date with all relevant legislation changes.
Setting realistic goals which align with new legislation is another key factor to consider going into the upcoming new year. Those who plan ahead and keep organised to achieve their goals stand a much higher chance of success.
Setting goals for 2023: the smart options
As the effects of the cost of living crisis and inflation sweep the country, it’s easy to not feel very optimistic about the upcoming year. However, setting realistic and achievable goals could help you feel motivated, which in turn helps to achieve success.
Diversifying your property portfolio:
Changing trends call for an updated look into your property portfolio.
Landlords looking for a profitable expansion within their portfolio should look into acquiring HMOs. These are a popular choice with university students seeking accommodation during their second and third years of study, leaving plenty of opportunity for profit within this sector for landlords. The constant demand from students and limited supply of housing means void periods would be minimal. HMOs are the much smarter option for both students and landlords.
The alternative accommodation option for students are PBSAs, which take long periods of time to develop, leaving students with a restricted number of options for living. This is where the profitability begins to show, as students will turn to HMOs when seeking accommodation, leaving landlords in a beneficial position.
Profit and revenue generation:
Although some may say focusing on portfolio growth may not be a smart choice right now, others would disagree. Some are investing in interest-only mortgages on rental properties, mainly due to the financial freedom they offer. Scaling your portfolio can be beneficial right now, but only when you consider geographically where you’re choosing. It may sound obvious, but make sure to research locations where you’ll earn the most profitable ROI.
However, only make this jump once you’ve established whether you have scalable systems to support you through the process. Quality over quantity and a reliable support system is integral to successful growth.
Review your current portfolio:
Before jumping into expanding your portfolio, conduct some research on your current portfolio. For example, look into which properties are providing the best yield, how many properties are you capable of acquiring now, where improvements can be made, and more.
An effective method of doing so would be to invest in a good property management software. Streamlined processes and centralised operations help to gain a detailed understanding of your current portfolio, and decide on the next move.
What can I do to prepare as a landlord?
Setting goals is all well and good, but they mean nothing if you aren’t prepared for what’s coming. Planning ahead will be the smartest decision you can make as a landlord.
Break down what needs to be done, whether this is applying for loans, or booking your EPC assessment as soon as possible. Make sure you know what your current tenants’ plans are, whether they’re thinking of staying, or moving on. Getting a clear understanding of this can prepare you for the next steps in terms of property marketing, application processes, and more.
The new year is coming up quickly, so completing these steps now is essential. Outstanding tasks should be done sooner rather than later, and having your goals and plans set out will keep you accountable and prepared for the year ahead.
To find out more about new legislation affecting landlords in 2023, as well as goals and preparation tips, read our eBook “How landlords should plan, prepare, and prosper for 2023”
*Disclaimer: this blog is only intended as a guide, and is not to be taken as legal advice*