According to the English Private Landlord Survey 2021 less than half of private landlords in the UK use a letting agent and only 18% use a letting agent for management services.
In the past it was relatively straightforward to let and manage a rental property without using an Agent. However, there is now a huge amount of legislation covering everything from how deposits should be registered to when smoke detectors must be tested. It is essential to keep fully up to speed with all the different regulations as many of the rules have been linked to a landlord’s ability to seek possession.
Here is a list of things you need to consider if you are planning to let a property:
- The Hassle Factor
- Do you have the time and energy to deal with tenant’s queries and problems?
- What would you do if your tenants want to break the tenancy early?
- How would you deal with a request to keep a pet?
- Do you know reliable tradesmen like plumbers, electricians and handymen who you can call on to deal with maintenance issues? And do you know that they have the required certification?
- How would you manage a boiler break-down in the middle of winter?
- What would you do if the tenant won’t give you access to carry out the Landlord’s Gas Safety Certificate?
- Are you prepared to carry out routine maintenance inspections and have difficult conversations with your tenants about housekeeping issues like damp and mould?
- Would you know what to do if your tenants stopped paying the rent?
- What do you know about ‘fair, wear and tear’? The importance of an Inventory & Schedule of Condition? And do you know how to register the deposit?
- Being a landlord is a big commitment so if you’re at all unsure about your responsibilities and obligations, you almost certainly need to instruct a Letting Agent.
- Check Your Mortgage
- Think About How Long You Want To Let Your Property
- Work Out Your Tax Position
- Overseas Landlords
- Preparing To Let Out Your Property
- Consider If Any Works Need To Be Done
- Energy Performance Certificate (EPC)
- Electrical Safety Standards
- Gas Safety Regulations 1998
- Smoke Alarms and Carbon Monoxide Alarms
- Take Out Rental Insurance to Protect Your Property
- How to Rent Guide
- Deposits
- DPS – Deposit Protection Service
- TDS – Tenancy Deposit Scheme
- MyDeposits
- Inventory & Schedule of Condition
- Have all safety certificates ready for when the property goes on the market
- Make sure your agent has information relating to internet/broadband speed, mobile phone coverage, any quirks of the property, or flood risks
- Do all those little maintenance jobs like fixing loose paving stones or replacing tricky locks
- The outside of the property should be in good decorative order, gutters cleaned and emptied and the garden neat and tidy.
- The property should be cleaned to a good professional standard including carpets, cooker and windows.
- Any appliances should be serviced and in good working order and you should provide user guides
- Septic tanks should be emptied and chimneys swept
- Draw up a list of any special conditions relating to e.g. rights of access or how often the woodburner or Aga needs to be serviced
Aside from keeping up to speed with the regulations, being a landlord can be hard work and there are many benefits to using a professional Letting Agent! If you’re planning to self-manage, it is well worth spending some time to consider the following:
If you are planning to rent out your own home (rather than a buy to let property), you are legally required to inform your mortgage lender. Some mortgages contain clauses which won’t allow you to let on your existing mortgage, while others require notification to grant ‘consent to let’. Sometimes there may be a fee to pay and your mortgage agreement may also have terms specifying what sort of tenancies they will permit.
Most tenants want the security of a long term let with the flexibility to end the tenancy sooner if they need to. If you only want to let your home for a short time, this will impact on how rentable your property may be.
If you plan to rent out your property, you are obliged to inform HMRC and may be liable to pay tax via a self-assessment tax return. It could also impact how much Capital Gains Tax you have to pay when you sell the property, so it’s important to work out how much tax you might be eligible for as this may determine whether letting the property out makes financial sense.
If you live abroad or are out of the country for more than 6 months, you must register with HMRC as a Non-Resident Landlord. Please note that this also applies to members of HM Forces who are deployed.
A rental property needs to have a number of health and safety tests to make sure it is safe to let out. Amongst other things these checks include, a gas safety test and annual boiler service, a fixed wiring electrical safety test, a portable appliance test and annual services should be completed for any oil or solid fuel appliances. You must fit smoke alarms on every floor of your property and a working carbon monoxide detector anywhere there is a solid fuel appliance or working open fire.
Look at your property as if you were seeing it for the first time. Some rooms may need to be repainted, and to achieve a better rent and to attract the best tenants, more work may be required but we can advise you.
It is a requirement for residential properties to have a minimum energy performance rating of E to be let.
The electric installation must be inspected and tested every five years by a qualified person. Once this is done a copy of the Electrical Installation Condition Report (EICR) must be provided to the tenant. If the inspection is deemed unsatisfactory, you have 28 days to resolve any issues.
A Gas Safe registered engineer must check the gas appliances in the property and a Gas Safety Certificate (LLGS) must be provided and renewed annually.
All rented properties are required to have smoke detectors and carbon monoxide alarms fitted.
Your tenant will be advised to get contents insurance for their possessions, but you’ll need specialised rental insurance for the building and any contents you leave.
Even if your property is let ‘unfurnished’ make sure you are covered for your possessions such as carpets, flooring, curtains and white goods. You should tell your insurer of any high value items as these might need a greater level of cover. If you don’t get the right policy for letting, such as cover for accidental damage to the property or cover for accidents or injury to the tenant or any visitors to the property, any claim may be invalid.
You may (as long as your tenant passes references) also be eligible for landlord legal or rent and legal protection insurance. Even the most reliable tenants can experience financial difficulties and taking out such a policy can help as a safeguard to protect your rental income.
As of October 2015, a copy of the government publication must be provided to the tenant at the start of the tenancy.
Tenancy deposits are capped at the equivalent of 5 weeks' rent and must be registered with one of the 3 tenancy deposit schemes:
Each of the 3 schemes have their own rules and you will also need to comply with the Tenancy Deposit Legislation.
It’s vital to have an independent inventory carried out – this is especially important to help avoid dispute when the tenancy comes to an end.
A tenancy agreement requires the tenant to return the property and contents in the same condition as at the start of the tenancy and so the inventory is vital to record the schedule of condition at the start of the tenancy.
Letting a property can happen quickly so make sure you have everything ready as soon as you start advertising.
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