In the last few months, we have seen growing demand for rental accommodation, along with a rising number of first-time landlords.
For those who have just started on their property investment journey, it can be daunting trying to keep up with the constantly evolving laws and regulations. However, with things starting to get back to normal these tips could help you to maintain some clarity surrounding your obligations as a landlord.
Obtain a license
Your starting point is to check whether you need a landlord license from your local council before your property can legally be rented out. This legislation was introduced in 2006 with the main purpose of ensuring landlords maintain their rental properties to an acceptable standard.
Furnished or unfurnished?
If you are renting out your property furnished, consider what items you want to include in the itinerary. Don’t let the property with anything valuable or sentimental and all upholstery just comply with the fire and furnishing act. If you are renting an apartment to students, you may find it easier to let with furniture as they are unlikely to have lots of belongings having just left home or previous digs, but if you have a house it’s likely that your tenants will be a family or couple and are more likely to have their own furniture, making an unfurnished property more appealing.
You are legally required to provide fire alarms on every floor of the property and carbon monoxide detectors in rooms where solid fuels are burnt. They need to be tested and in full working order and you will need to provide copies of the gas safety and electrical safety certificates to the tenants along with a copy of the EPC.
Tenants with pets
It’s worth deciding if you are comfortable renting to tenants with pets. With many more people with pets following the pandemic, there has been a rise in tenants seeking a property that will accommodate their new companion. By allowing pets you could have longer-term tenants, but this will need to be weighed up with the wear and tear to the property they could cause or any disputes with neighbours should the pets be noisy.
In order to protect your property and your rental income, it’s important that you rigorously reference new tenants to ensure they are reliable, have a good credit score with no rental payment defaults, and can make the rental payments each month. You will need to confirm that they have credit eligibility, employer checks are acceptable and that they have good landlord references. This is something a good letting agent will assist you with.
Tenancy Deposit Protection
Your tenants’ deposit must, by law, be protected in one of the Government-authorised Tenancy Deposit Protection schemes. There are three available – Deposit Protection Service (DPS), MyDeposits or the Tenancy Deposit Scheme (TDS). It will need to be placed in a scheme within 30 days of receipt and you will need to give the tenant the Deposit Protection Certificate and completed Prescribed Information. Failure to do so could result in you not being able to evict your tenant plus the full return of the deposit and a fine of up to three times the value of the deposit. Your letting agent can deal with this on your behalf.
Your tenants must have a copy of the Energy Performance Certificate (EPC). Your property must be at least EPC band E before letting it out and you could receive a fine if you try to arranging a new let without ensuring your property meets these standards.
You should regularly inspect the property whilst adhering to all COVID-19 safety measures, and you will need the tenants’ permission in advance, and this should be stipulated in the tenancy agreement. Again, a good letting agent can carry out these checks for you.
It’s essential that you inform your building insurer that you are renting the property out in order to maintain the validity of the policy as you will need specialist landlord insurance that will cover loss of rent, damage, legal expenses and liabilities.
Choose an agent
It’s vital that you are familiar with your role and responsibilities as a landlord before marketing your property. If you don’t comply with the rules and regulations from the very beginning of the tenancy, you may find yourself in a vulnerable position should anything go wrong. That’s why it’s essential that you choose an agent who can advise you on what you need to do and can help you vet tenants to ensure your property is in safe hands.