Video: Pexels

COST SAVER PODCAST • Ep. 40

Maximising Rental Profits: Avoid These 7 Hidden Costs Landlords Overlook

Hosted byAsad & Angela(AI-generated voices)
25 April 202616 min listenSeason 1 • Ep. 40

Listen on

SpotifyApple PodcastsAmazon MusicYouTube

Recommended Cost Saver Partner

Sponsored Partner Alert

Need a surveyor, conveyancer, or letting agent? Get free quotes from vetted UK property professionals on Bark and make sure you're not overpaying.

Compare Local Property Professionals on Bark

We may earn a commission on purchases at no extra cost to you. While we only partner with trusted platforms through reputable affiliate networks, all services and accounts are managed directly by the provider, who will handle any customer care or account needs.

Maximising Rental Profits: Avoid These 7 Hidden Costs Landlords Overlook

Now Playing · Ep. 40

Maximising Rental Profits: Avoid These 7 Hidden Costs Landlords Overlook

The Cost Saver Podcast

00:000%00:00

AI-generated voices. For information only - not financial guidance.

Key moments

1The Illusion of Rental Profit
0:00
2Void Periods and Maintenance Budgeting
3:17
3Navigating Compliance and Agent Fees
6:34
4Tax Implications and Essential Insurance
9:31
5Empty Property Costs and True Yield
11:59
6Practical Steps for Landlords
13:54

Key Takeaways from This Episode

  1. 1Budget for at least three weeks of void periods annually in your financial planning.
  2. 2Set aside 1% of the property's value each year for maintenance and repairs.
  3. 3Understand and budget for all compliance costs, licenses, and landlord-specific insurance.
  4. 4Calculate your actual post-tax profit considering current mortgage interest relief rules.
  5. 5Stress-test your property investment by assuming a 2% higher mortgage interest rate.

Episode Transcript

Asad & Angela — AI-generated hosts · click to collapse

v
A
[Angela]:
Welcome to Cost Saver Conversations. I'm Angela, and I ask the practical questions so you can quickly understand what matters. Today, I'm joined by Asad.
A
[Asad]:
Hi Angela. We are unpacking "Maximising Rental Profits: Avoid These 7 Hidden Costs Landlords Overlook" today and tying it back to the wider Cost Saver ecosystem, including tools like Landlord Rental Yield Calculator and rental yield calculator, so you can turn insights into action quickly.
A
[Angela]:
Just a heads-up before we dive in: we are your synthetic hosts. We are great with numbers, but as AI, we can sometimes be confidently wrong. Think of us as the digital versions of your most knowledgeable, slightly caffeinated friends.
A
[Asad]:
Exactly. Treat this chat as a smart estimate only, not as professional financial guidance. Always check important details with official sources or a qualified expert before making any big decisions.
A
[Angela]:
Welcome back, everyone. So today we are getting into something that I think is going to save some people a lot of money — or at least stop them losing it without realising. We're talking about hidden costs for landlords. Asad's here, as always. Asad, I feel like this is one of those topics where people think they've got it figured out, and then... they really don't.
A
[Asad]:
[chuckles] Yeah, that's — that's pretty much it. I mean, the classic thing is, someone sits down at their kitchen table, right, works out the rent, subtracts the mortgage, and goes, 'Great, that's my profit.' And, um, estate agents love presenting it that way because it makes everything look generous.
A
[Angela]:
Right, because it's such a clean number.
A
[Asad]:
It is! It's tidy. It feels good. But the problem is, that calculation is missing about a dozen line items that are going to show up whether you've planned for them or not. And we're not talking about, like, freak disasters. We're talking about a boiler dying, a tenant leaving, a new bit of legislation that needs a certificate or an inspection or a fee. Just... the normal boring stuff of owning property.
A
[Angela]:
And the source material says that mistake — just that simple rent-minus-mortgage sum — costs the average UK landlord somewhere between two and four thousand pounds a year in stuff they didn't budget for. That's not nothing.
A
[Asad]:
No, it's really not. And it's — the thing is, it's not one big hit. It's lots of small things quietly chipping away at your yield. Which is kind of... harder to notice, honestly.
A
[Angela]:
So there's an example in here that I thought was really telling. Sarah from Leeds?
A
[Asad]:
Yeah, Sarah. So she bought her first buy-to-let in 2022. A £180,000 flat, £975 a month in rent. On paper, 6.5% gross yield. Looks great, right?
A
[Angela]:
Sounds lovely.
A
[Asad]:
Two years in — six-week void, a £2,400 boiler replacement, selective licensing fees of £825, and then the mortgage interest tax changes on top of all that. Her actual net yield? 2.8%.
A
[Angela]:
Oh wow. That's — I mean, that's less than half of what she thought she was getting.
A
[Asad]:
Exactly. And she wasn't unlucky. She just hadn't budgeted for reality. Does that make sense? Like, none of those things were unusual.
A
[Angela]:
No, totally. They're all just... things that happen. Okay, so let's go through these seven hidden costs one by one. What's number one?
A
[Asad]:
Void periods. The gap between one tenant moving out and the next one moving in. And most landlords just — they plan for zero voids. Which is, honestly, wishful thinking dressed up as a business plan. [laughs]
A
[Angela]:
[laughs] That's a good way to put it. But I mean, the mortgage doesn't care that the flat's empty, does it?
A
[Asad]:
No! The mortgage still needs paying. Council tax flips to you. Utilities are ticking over. On a property with a, say, £1,000 monthly mortgage, every empty month costs you roughly £1,300 once you add council tax and utilities on top.
A
[Angela]:
Wait, really? So it's not just the mortgage you're eating, it's more than that.
A
[Asad]:
Yeah. And the realistic UK average for voids is somewhere between two and four weeks per year, though it varies — I mean, student lets can be much longer over summer. High-demand commuter towns, almost nil if the property's well-presented. But as a baseline, build in at least three weeks of voids per year when you're modelling.
A
[Angela]:
And there's a really scary warning in here about bad tenants.
A
[Asad]:
Oh yeah. So a single bad tenant who has to be evicted — you're looking at a void of three to six months once you factor in the court process, repairs, re-letting. And with Section 21 reforms working through Parliament right now, eviction timelines are likely to get longer, not shorter. So reference checks are just... they're not optional.
A
[Angela]:
[sighs] Right. Okay, cost number two?
A
[Asad]:
Maintenance. And the — well, the thing is, properties wear out. That's just what they do. Boilers die at the worst possible moment. Washing machines flood kitchens. Roof tiles slip in the first proper storm. None of it's dramatic, but all of it costs money.
A
[Angela]:
So what should people actually set aside?
A
[Asad]:
A sensible rule of thumb is roughly 1% of the property value each year. So on a £200,000 flat, that's £2,000 a year, about £167 a month. Some years you'll spend nothing. Other years you'll replace a boiler at £2,500 and repaint the whole interior for another £1,500 to £3,000.
A
[Angela]:
And there's a whole list of big-ticket items in the source — kitchens, bathrooms, windows...
A
[Asad]:
Yeah, over a 10-year holding period you need to be thinking about things like a kitchen refresh, which could be £3,000 to £8,000, bathroom £2,500 to £6,000, new flooring £1,500 to £4,000. These aren't if, they're when. You know?
A
[Angela]:
Hmm. And then there's the energy efficiency angle, which I thought was interesting because it's sort of a cost but also an investment?
A
[Asad]:
Right, exactly. Energy efficiency upgrades sit in a slightly different category because they pay you back over time. But the big thing is, Minimum Energy Efficiency Standards are likely tightening to EPC C by 2028 for new tenancies. And if you wait and have to rush it, you could be looking at £5,000 to £15,000 in upgrades. Getting ahead of that saves you a fortune.
A
[Angela]:
Oh that's actually reassuring in a way — like, spend a bit now, save a lot later. Okay, number three. Compliance, certificates, licensing. This feels like a minefield.
A
[Asad]:
It is. It absolutely is. And it's the area where new landlords get caught out the most, because the compliance burden has just grown steadily over the last decade. And 'I didn't know' is not a defence that holds up anywhere — not in court, not with insurers, nowhere.
A
[Angela]:
So what do you actually need?
A
[Asad]:
Okay, so the non-negotiables: Gas Safety Certificate, renewed annually, around £80 to £120. Electrical Installation Condition Report, every five years, £150 to £300. Energy Performance Certificate, valid for ten years, £60 to £120. Then smoke and carbon monoxide alarms tested at the start of every tenancy, Legionella risk assessment particularly if you've got water tanks, and Right to Rent checks for every adult occupant in England.
A
[Angela]:
That's already a lot. And then there's licensing on top?
A
[Asad]:
Yeah, so many councils now run selective or additional licensing schemes. Fees vary enormously — from a couple of hundred pounds to over a thousand per property. Licence usually lasts five years. And if your property falls in a designated area and you don't license it—
A
[Angela]:
—let me guess, big fines?
A
[Asad]:
—often £10,000 or more per offence.
A
[Angela]:
Per offence! That's... yeah. And there's the deposit protection thing too, right?
A
[Asad]:
Right. Every deposit has to go into a government-approved scheme within 30 days. If you don't do it and a tenant takes you to court, you can be hit for up to three times the deposit value. The custodial schemes are actually free, but, um, you just have to actually do it. [chuckles] Set a reminder.
A
[Angela]:
Ha, fair enough. Okay, cost four — letting agent fees. I feel like people know these exist but maybe don't realise how much they actually add up to?
A
[Asad]:
That's exactly it. So there are basically tiers. Tenant-find only is usually 8% to 12% of the first year's rent, paid up front. Rent collection, around 8% to 10% of monthly rent, ongoing. Full management, typically 10% to 15%, ongoing. And then there's inventory fees, check-in fees, tenancy renewal fees, inspection visits — it all adds up.
A
[Angela]:
So give me a real example. A property at, say, £1,200 a month on full management.
A
[Asad]:
At 12%, that's £144 every month. £1,728 a year. Before VAT. That's a meaningful chunk of your gross rent, and it has to be in your yield calculation from day one.

Full Written Guide: Maximising Rental Profits: Avoid These 7 Hidden Costs Landlords Overlook

This podcast episode is based on the companion article for deeper context and references.

Read the full written guide: Maximising Rental Profits: Avoid These 7 Hidden Costs Landlords Overlook

Tools Mentioned in This Episode

Short-let apartment representing Airbnb vs long let UK comparison
Property & Home5-7 minutes
NEW

Airbnb vs Long Let Rental Profitability (UK, 2026)

Short-let vs traditional let — with Section 24 and London 90-night cap.

Try it free

Related blogs

Is Your DB Pension CETV Really Worth It? UK Mistakes and Hidden Costs
Guides
17 Jul 2026

Is Your DB Pension CETV Really Worth It? UK Mistakes and Hidden Costs

A friendly, honest look at DB pension CETV calculators, where they mislead you, and how to make a better transfer decision. Real numbers, hidden costs, and safer alternatives explained.

Carpool Savings Calculator UK: The Hidden Pitfalls That Could Cost You More Than You Save
Guides
16 Jul 2026

Carpool Savings Calculator UK: The Hidden Pitfalls That Could Cost You More Than You Save

A UK carpool savings calculator can show real fuel and mileage savings, but insurance rules, tax quirks and wear-and-tear can eat into your gains. Here's how to carpool the smart way.

The UK Emergency Fund Playbook: Sizing Your Safety Net for Real Life
Guides
10 Jul 2026

The UK Emergency Fund Playbook: Sizing Your Safety Net for Real Life

Avoid the biggest UK emergency fund mistakes in 2026. Use our Emergency Fund Runway Simulator to get a personalised savings target and protect yourself from inflation and unexpected expenses.

FAQ

Q: What is this episode about?

A: This episode covers: landlord costs, rental property. It explains the most practical ideas first, highlights common mistakes, and gives clear next steps you can apply to your own situation without needing specialist knowledge.

Q: How long is this episode?

A: This episode is approximately 16:23. You can use key moments to jump directly to sections, revisit the parts that matter most to you, and turn the guidance into a short action list after listening.

Q: Can I read this instead?

A: Yes. Check the "Related blog article" section for the full written version with links and references. The written format is useful if you prefer scanning, comparing options line by line, or sharing specific points with family members.

Q: Can I listen on other platforms?

A: Yes. Use Spotify, Apple Podcasts, Amazon Music, and YouTube links on this page when available. Platform availability can vary by processing time, so if one link is delayed, the web player and companion blog still provide full access.

Q: What other topics are covered?

A: property investment, hidden expenses, rental yield. These are connected to the main discussion so you can understand trade-offs, avoid one-sided decisions, and choose actions that are realistic for your budget and timeline.

Q: Which tools should I use after listening?

A: Start with: Airbnb vs Long Let Rental Profitability (UK, 2026), Landlord Rental Yield Calculator, Rent vs Buy Reality Calculator. You can find them in the Related tools section below. A good approach is to run one baseline scenario first, then test two or three alternatives so your final decision is based on numbers, not guesswork.

Q: Are there related blogs I can read next?

A: Yes. This episode links to 8 related blog articles for deeper context. Reading one follow-up article is often enough to clarify assumptions and help you build a practical weekly or monthly plan.

Topics covered

landlord costsrental propertyproperty investmenthidden expensesrental yieldproperty maintenancetax implicationscompliancevoid periodsbudgeting

Explore these topics

Pick a topic tag below, then use the quick actions once to browse matching blogs or episodes.

#landlord costs#rental property#property investment#hidden expenses
Quick actionsRead related blogsMore podcast episodes

Continue listening

Newer episode

Degree Debt vs Earning While Learning: Avoid UK Career Traps

Older episode

Decoding Postcode Crime Data: How to Assess Rental Risks in the UK