I've been meaning to write this article for quite a while! Experience in the letting game is hard won but as a professional letting agent with some personal experience as well I feel at least a little qualified to offer the following opinions.
In that time, I've seen loads of landlords buy loads of different properties. Some (in my view) have bought well. Others have bought less well (or to be precise been "sold something"). I've invested myself and have certainly bought things towards the start that I now regret - being within the industry has changed my perspective on what constitutes a good purchase!
So what type of landlord seems to do well?
Do not overpay.
Property is an investment, so if you overpay at the start, you're forever playing catch up in terms of trying to make that investment work. Some buyers are happy to pay the market rate for a genuinely nice property. Others seek dilapidated properties at reduced prices and generally get good deals even though works are required. Either is fine, but what you want to avoid is paying good money for a property that's actually pretty average - and that's 80% of the market!
Do have your business head on
What I'm saying here is that those who become a landlord accidentally struggle to make it work for them. If the house you're renting out was once 'home', there's always going to be an opportunity to feel 'the lawn wasn't like that when I lived there' or 'there are some scratches on that wall I took ages painting'. If you rent out a place you've never lived in, anything the tenant does isn't as personal.
Do maintain your property(s)
It's important that any property is kept up to date. If you spend nothing on it, over a few years it will become dilapidated which affects the value of your investment. Equally if you don't repair things quickly, decent tenants will get fed up with you and leave. Your property will churn more frequently and your tenant quality will drop too. You're now in a downward spiral which will cost you far more in the long run than keeping your property in good repair.
Do not 'fiddle'.
No I am not talking about money here. Good tenants want the 'peaceful enjoyment' of their property and invariably get frustrated by landlords who are overly attentive. We manage one property where I know the landlady (who's a really well meaning lady) has lost 3 tenants in the last few years because they feel like they are being 'supervised' - a property inspection on a 2 bed flat does not take 30 minutes and involve quizzing the tenants on their personal sleeping arrangements(!)
Do not become greedy.
You would be surprised how many landlords are OBSESSED with the amount of rent they are receiving. You can legally raise a rent every 12 months and this is the only date some landlords diarise - irrespective of whether the rental market or the state of the property justifies an increase - every year they force through a rental increase even if it's just a fiver. When you have a good tenant who looks after the property and is paying a decent rent anyway, this is a complete false economy as all it does is antagonise the tenant. It's the same with landlords who have got £x for a property previously and will dig their heels in until they get £x again - they fail to understand that you maximise your income by killing void periods and the costs associated with a change of tenant. If a good tenant comes along far better to take £10 less per month than lose a whole months rent in a void. Conversely landlords whose end of year figures look the best are those who've set a sensible rent to start off with, and once they have a decent tenant don't rock the boat.