How to rent residential properties

Introduction

In this blog article, we are going to discuss different types of residential properties, what they’re good for, and how you can make sure that you, or your household, are living in the best possible conditions.

If you are willing to live in a city, residential areas are the first ones you should inspect for finding your ideal home. When mentioning “residential areas” people usually describe a piece of land or area of the city used for permanent residences or domiciles, such as houses, apartments, nursing homes, schools or childcare facilities.

Areas where you, and your family, feel comfortable and safe to live. But, as you can imagine, houses there are more expensive and it’s not always easy to find the right place that suits your needs and budget.

Residential is a term also used to differentiate real estate assets between the ones that are considered non-commercial (private) and commercial (business). 

Basically, in the UK, residential means a place of residence.

What is Residential Renting?

Residential renting is the process of leasing a property for a residential purpose. It usually includes scenarios when a landlord rents out a property or a tenant rents it.

The terms of the lease will depend on the agreement between the parties involved – the landlord or letting agent, and the tenant.

Residential properties can be viewed as an investment opportunity, especially when the asset can be rented out for high monthly rent. Or for long periods of time such as with rent to rent agreements.

On the other hand, residential renting is also an alternative to home ownership. If you do not have enough money to buy or finance a home but you want (or need) to live in that area or city, you can still rent one.

If you are a tenant, residential renting offers lots of benefits including tax savings, and flexibility in choosing where you want to live and for how long.

If you are renting a residential property, here below are some of the things you need to consider:

• Taxes: The landlord pays taxes on their rental income and has to pay taxes when he/she decides to sell their property. Moreover, homeowners usually have to repay their mortgage instalments, even though the property might be vacant and may not produce any profits.
• Asset appreciation vs maintenance costs: Residential properties appreciate in value over time but so does the cost of owning them.
• No maintenance costs: Renter’s insurance and property taxes are often less than what homeowners pay for insurance, taxes and maintenance on their homes. This is because if something goes wrong, renters do not have to worry about maintaining their homes or paying for their repairs.
• Monthly rent payments vs mortgage instalments: Renters pay a monthly rent that can be either lower or higher (post taxes) than the mortgage instalments a landlord has to pay on their homes.
• Limited “freedom to move”: One of the most important advantages of renting residential properties is the freedom it gives people in terms of moving when necessary. People who rent homes, as soon as they respect the notice period agreed in the contract, don’t need any further approval from landlords before they can move out. On the other hand, as a landlord will be pretty difficult for you to change cities fast. You’ll need to either hire a letting agent to fully manage your property or sell it.

Check our dedicated articles on the questions to ask when renting.

What do you Mean By Residential properties?

The residential sector is part of the real estate industry that deals with private residences such as single-family homes and condominiums.

Residential property types include:

• Single-family homes

Also known as detached housing. Single-family homes are designed to be used as single-dwelling units, with one owner, no shared walls, and their own land.

• Condominiums

Condos are similar to apartments in that they are multi-unit buildings that are owned by individual owners, but they are different because they share walls with their neighbours. Condos may be owned by multiple individuals, private investors or corporations.

• Multifamily properties

These properties are buildings that are divided into two or more units, but all under the same roof. They can range from duplexes and triplexes to large apartment buildings or condos with hundreds of units.

• Townhomes

Townhomes are attached houses where each floor has two units side by side with a shared wall between them.

What is an Example of A Residential Property?

Residential property is a term used to describe the type of real estate assets that can be used as a home. The most common types are stick-built, manufactured, modular, and site-built homes. Each of these has its own advantages and disadvantages when it comes to building a home. 

Read this how to rent guide will help you make an informed decision.

• Stick-Built Homes

Stick-built homes are constructed on-site rather than prefabricated or factory-assembled like manufactured and modular homes. Stick-built homes are usually built using lumber and other materials found near the site where they will be constructed. These types of materials can be expensive when compared to other materials available nowadays on the market.

• Modular Homes

Modular homes are generally constructed off-site at a factory by one manufacturer who then ships them in pieces to the location where they will be assembled on-site by another contractor or directly by the future homeowner. Modular housing is becoming more popular today because is usually characterised by lower prices and shorter building periods.

What is Meant By “Residential House”?

A residential house is a building where people live. It can be an apartment, a condominium or a single-family home.

Residential houses are usually built on land that is owned by the person who lives there. The owner pays property taxes to the government, which uses that money to pay for services like fire stations, public schools, hospitals and parks in the neighbourhood.

In some cities, there are special rules that apply to how close you can build a new home to your neighbour’s property line. The government uses these rules to prevent overcrowding and protect privacy.

What Does it Mean to Live in Residential Areas?

Residential areas are areas that are designed for residential purposes. These areas usually have a higher population density than rural areas. Residential areas are often located in towns and cities, but can also be found in rural locations. These areas often have an established building code that is enforced by local governments.

Residential areas can be divided into four categories: single-family homes, multi-unit dwellings, mobile home parks, and apartment complexes.

• Single-family homes are detached houses that may or may not be attached to other homes by shared walls
• Multi-unit dwellings consist of two or more apartments, condos, or townhouses that share walls with each other
• Mobile home parks are usually located in rural areas where there is plenty of space for the park owner to build mobile homes on lots that are leased out to tenants who live in the park full-time
• Apartment complexes consist of multiple apartments. Apartments can range from small one-bedroom units to large units with several rooms

Are Residential Houses More Expensive?

The answer to this question is actually a little more complicated than you might think. At first glance, it would make sense that Residential homes would be more expensive than apartments. After all, homes usually have more square footage and amenities like pools, gyms, garages, etc. However, many factors can affect the cost of a home or an apartment.

The main factor is location. Some areas are just more expensive than others because of their proximity to restaurants nice areas or work opportunities. Homes in these areas will be more expensive than those in other areas that don’t offer as many amenities. Similarly, the furnished vs unfurnished properties are another endless debate.

The cost also varies with the type of home you want to buy or let out for short term rent.

Who is a rent guarantor?

A Rent guarantor is an individual or an organization which provides a guarantee to a landlord that they will pay the rent in case the tenant fails to pay the rent on time and falls into arrears.

Where Is Best to Rent Residential Houses in London?

London is a huge city and there are many areas to choose from when you want to rent residential houses. Some of the areas are more expensive than others, but by spending some time researching, you will find a good deal.

If you are looking for a place on your own, then you should consider renting in Southwark or Tower Hamlets. These two boroughs are very close to central London and have good transport links. You will also find that there is plenty of space for you to enjoy life in these boroughs.

If you have children and want them to be close by, then it might be worth considering renting in Croydon or Bromley. Both boroughs have good schools and they are close enough to other parts of London.

If you want somewhere that is more rural but still close enough for your children to get around by themselves without too much trouble, then you should consider renting in Epping Forest or Havering.

These areas have beautiful countryside and great transport links to central London. This makes them ideal places for families who want to live somewhere more peaceful but still close enough to the city centre. 

Click here to find out more about the best areas in the UK.

How To Optimize Your Residential Project to Maximize the Investment

The success of a residential project is often measured by its ROI (return on investment). This metric is used as a way to compare similar projects and determine which will be the most profitable in terms of their return.

Here are some ways you can improve your project ROI:

• Increase value: The first step in optimizing your residential project is to increase the value of your home. This can be done in many ways, including adding features such as a deck or patio, adding insulation, installing energy-efficient appliances and upgrading your home’s appearance with exterior paint jobs.
• Reduce costs: Another way to optimize your residential project is by reducing costs. You can do this by choosing lower-cost materials that still deliver the same quality results and using less expensive labour for construction. Having said this, make sure you comply with basic building safety and tenant right rules or a tenant can sue a landlord for not providing the right features of a home.
• Buy when prices are low: The most important thing you can do for yourself as a buyer is to buy when prices are low. When the market is booming, many people get caught up in the excitement of buying real estate and forget about investing strategies. While this may not seem like a good idea at first glance, it’s actually a great time to purchase property because prices are lower. Buyers who purchase during crisis times will have more leverage when negotiating with sellers or listing agents and will be able to get better deals on properties than they would usually do.
• Negotiate with sellers and listing agents: One of the best ways to maximize your potential return on investment (ROI) is by negotiating with buyers and listing agents.

Stamp Duty Land Tax on Residential Properties

Stamp duty land tax was introduced in 2003 to replace the former Stamp Duty Reserve Tax (SDRT). SDLT is charged at different rates depending on the property value and whether it is a residential or non-residential property.

Residential properties include houses, flats, maisonettes and bedsits. When you buy a residential property over £125,000 you will have to also pay SDLT on top of any other fees.

Non-residential properties include commercial buildings such as offices, warehouses and factories. When you buy a non-residential property over £150,000 you will have to also pay SDLT on top of any other fees such as conveyancing costs.

Click here to read a London housing market report.

Conclusion

Residential land is primarily reserved for residential use, but if the definition is too wide, it may lead to the application of another separate definition. In practice, distinctions between residential and non-residential land are not easy, the boundaries are not clear. After all, properties are largely used for personal use and as living spaces for their owners in both cases.