Online letting agent Upad has further revealed the extent to which landlords continue to throw money away and 'could make huge savings to increase their buy- to-let profits'.
Inspired by recent research from Nationwide Building Society that highlighted the sums of money landlords are spending on their rental each year, as well as the proportion of landlords who earn far below the mean monthly and annual profit across the sector, Upad has looked at the areas where it is easy for landlords to throw money away.
Upad’s research and internal data has revealed that landlords that use high street letting agents are often subjected to fees such as 12% of the total invoice amount as an administration fee for any major works or £120 just for calling out a plumber, electrician, or another contractor, which might not even cover some of their work.
These fees are often the ones responsible for eating into a landlord’s profits, and while they’re often treated as unavoidable costs that come with the territory, Upad has stressed that this isn’t the case.
Commenting on this and the Nationwide research, Upad founder and portfolio landlord James Davis said:
“There’s an awful lot of research out there now focusing on the cost of letting to a landlord. While much of this seems to be presented in a way designed to scare landlords into selling up, the reality is that buy-to-let is still a profitable opportunity without landlords’ only apparent option being to keep putting the rent up.
To those landlords who don’t earn what they want to from their buy-to-let investment or don’t know what they earn I say this: re-engage yourself with your buy-to-let, treat it like a business, review every pound you spend and what you actually get for it, and if your current outgoings specifically related to your letting agent aren’t working for you, make a change.”