While we all know property investment can yield great returns, it's very easy to forget about the costs involved for landlords and the sound judgement needed to balance that bottom line.
As well as costs around legislative compliance, landlords also face large outlays in other areas - all of which can impact on their profits.
Let's look at some of the costs you can expect when letting out a property...
The costs of being a landlord
Letting managementOne of the best ways to ensure you're compliant as a landlord is to use a managing agent to look after your buy-to-let investment.
Landlord legislation has never been more stringent and the penalties never more severe, so staying on the right side of legislation is crucial.
A good lettings agent working on a full management basis should also take on tenant find, referencing and screening duties, as well as arranging tenancy agreements and inventories, collecting and chasing rent and organising routine and emergency maintenance work with contractors.
Essentially, your managing agent is the communicative bridge between you and your tenant and can be worth their weight in gold for landlords who value their time as much as their income.
Of course, all this comes at a cost, however, which varies depending on the level of service your agent provides.
The cost of finding tenantsIf you choose not to use a managing agent or a tenant find service, you'll still endure other costs associated with finding tenants.
Online and print advertising, and even social media posts, can cost money.
Once you have found potential tenants, you'll need to credit check and screen them for suitability.
And once you are satisfied you have found a suitable tenant, you should have a written tenancy agreement drawn up, as well as a property inventory report.
Building and contents insuranceWhile contents insurance is usually only necessary if you are renting your property furnished, protecting your investment with buildings insurance is a must for landlords.
And it's not just a case of securing a standard policy - landlords should have specialist cover in place before starting a tenancy.
Landlord insurance can also cover you against damage to your property by a tenant or visitor, accidental damage, legal expenses and rent defaults.
Safety and maintenanceEven if you consider your property to be safe and in perfect working order, there will always be maintenance costs throughout a tenancy and in the longer term.
A regular maintenance programme can help keep problems from becoming huge, costly issues, but there are a number of safety checks written into landlord law.
Those include obtaining a valid Energy Performance Certificate (EPC) every 10 years and undertaking a gas safety check, via a Gas Safe engineer, every year.
Costs of cleaningEven if your tenant is clean to the point of near obsession, you will almost certainly have to draft in professional cleaners to bring your rental property up to scratch when a tenancy ends.
If you consider your property to have been left in an unacceptable condition, you could apply to withhold a portion of your tenantâ€™s deposit to cover some costs.
Void periodsWhile renting out your property for 12 months a year might be an aim, in reality you should prepare for the odd void period.
These can be costly, so it can pay to have a fighting fund in place to cover bills while your property remains empty.
Mortgage paymentsYou'll need a buy-to-let mortgage for your property - or you'll need to switch your mortgage to one if you're renting out your main residence.
Buy-to-let mortgages can sometimes command bigger fees and higher interest rates so you should always shop around where possible for the best deal.
Your mortgage payments will almost certainly form the biggest cost around your rental property, while changes to mortgage interest tax relief currently being phased in could also impact on your profits.
The cost of your timeIf you value your time and your primary aim from buy-to-let is to add more of it to your life then you should consider, where possible, outsourcing time-consuming elements of running your property.
Landlords often forget about 'time' as a true cost, but it also has a value and should be considered as such.