It is always better to have more than one egg in your basket and landlords with only one or two properties are reportedly finding it much harder to cope with the current economic recession than landlords with larger portfolios of buy to let properties.
According to research carried out by one independent body, the number of landlords who own only one buy to let property and who are facing financial problems has doubled in the last quarter. This is a sharp rise on the previous quarter and indicates just how tough the conditions faced by smaller landlords are at the moment.
One of the biggest issues affecting smaller landlords is the financial fallout caused by significant periods of rent void. Tenant demand might be high, but if your tenants can’t afford to pay your rent, it won’t be long before the cash flow dries up—and if you have a mortgage to pay, this is not a good state of affairs!
The best way to become a profitable buy to land landlord is to spread your income over a larger portfolio of properties: figures show that around 68% of full-time landlords with more than eleven buy to let properties are currently showing a healthy profit.
However, no matter how many buy to let properties you own, the best way to ensure you are not caught out by significant void periods is to choose your tenants very carefully. Times may be tough, but demand for rental accommodation continues to grow and buy to let is still a good investment for would-be landlords.
