Your exit strategy forms a key part of your business plan for your rental property. What is your long-term plan with your buy-to-let? Do you want to hold it? Sell it? Return to it? Your answer will steer your decisions.
If you’re planning to sell in the next few years, it makes sense to avoid any major upgrades unless they will raise the sale price. Instead, you will just keep the property ticking over. Ideally you want to secure a top rent and not be too fussy about the tenant type. Importantly, you will structure tenancy agreements so that you can give
notice when you need to.
However, if you intend to hold your property for many years, it’s much more critical to get the type of tenant who will look after it and ideally stay longer term. This may mean accepting a slightly lower rent. In the long run, it’s usually more cost effective to tackle any maintenance problems proactively before they become major issues.
Likewise, whether or not you plan to return to your property will determine your choice of finishes: do you go for personal preference or durability and wide appeal? You can justify those hand-painted Moroccan bathroom tiles if it’s going to be your domain again; if not, your tenants might be happier with simple white porcelain.
» Sale chills boiler plans
Jenny and David had an inefficient old back boiler in their 1930s house, which landed their tenants with astronomical energy bills. The unhappy tenants pushed for an efficient new combi-boiler and the landlords got a number of quotes. Yet at the same time the landlords decided to sell the house, so they then opted to keep the existing boiler but give a goodwill contribution towards the tenants’ energy costs. A new boiler would have cost them around £5,000, but wouldn’t have increased their sale price.