With summer in full flow, thousands of British landlords will soon be waving goodbye to their tenants for another term… Whilst they’re gone, a refit may be desirable. It’s as good a time as any to raise the value of your property.
GoSimpleTax are keen to show you how to rejuvenate a property on a budget. Trust us – there’s no need to watch money drain away before your eyes, even when the refits are set to be a large undertaking.
1. Choose a furnishing brand with managed facilities
Eager to wheel out that old chest of drawers? How about replacing a coffee table, bed or dining arrangement? That’s all well and good, except some companies don’t deliver or install them, or they charge extra for the privilege. They may be lazy with packaging too, failing to clear up after themselves.
We recommend looking for a ‘managed facilities’ service. This means they’ll look at your floor plan, make suggestions, and deliver and install the furnishings on your behalf. When the delivery van pulls away, it’ll leave a functional space behind.
2. Opt for reclaimed pieces
Vintage fashion is going nowhere fast. The 2010s have been characterised by a love for wood and metal – which is music to the ears of landlords looking to save on brand-new fit-outs. Second-hand stores have a wealth of great items tucked away; it might be worth scouting them for a quirky dresser or chair set at a very fair price.
Large-scale landlords who managed dozens of flats in one site might struggle, as there’s less chance of a unified aesthetic from space to space. Yet traditional student housing is open for an experiment; reclaimed antiques can attract much of today’s rental market.
3. Budget against your yield per property
What demographic are you aiming at? Working-, middle- and upper-class students – pursuing a course with its own financial demands – may largely dictate what you’re charging for rent and the area you’re investing within. It can be tempting, however, to spend too much for a refit: the value has to be paid back within a few months, relative to the yield you’re bringing in.
Say, for instance, that you predict a £600 a month profit for a house of four students. Pursuing a renovation worth £6,000 is going to set you back 10 months, so it has to be worth the cost. Approximating the right refit value for certain properties helps you raise the rent slightly, whilst never turning away those who actually want to live there.
4. Calculate expenses as you go
As a landlord, you’re able to classify some decisions as ‘revenue expenditure’, which are used to restore a property back to its previous condition. You can’t add value to the student home, but you can gain a 100% tax break on new fittings, furniture and utilities that represent a modern version of what you used to have.
When doing so, we recommend utilising the latest mobile software. In real time, it will analyse and deduct any allowable expenses. At the end of the financial year, you can present the evidence, and this can help reduce your tax bill.
These are just four methods of saving big over the summer months, when a refit is most likely to happen. The more sites you have, the bigger the savings will be – it all adds up…
GoSimpleTax is an innovative tax calculator, built to clarify what you’re able to claim, and submit your Self Assessment or corporate tax return directly to HMRC. All the specifics of landlord expenses are included within it, and the cloud-based software offers tailored tips and guidance as you go. Try this 14-day free trial to find out what a mobile solution can do for your business.