There are now lots of rules and regulations governing rental properties. These can be a bit of a minefield and put lots of people off from self-management. However, the cost savings using My-Let services are enormous. It is perfectly feasible to do this for yourself provided you do your homework first and have sufficient time to manage the property. Some of the key considerations are as follows:
What you need to do before letting out your property
- If you are thinking of letting out your property for the first time, you may written need permission to do so:
If this is your own home and you may wish to return to live there you should, just prior to letting, serve a written notice under Ground 1 of the Housing Act 1982 Schedule 2. This informs the tenant you may wish to return to live there yourself and will ease the process of re-possession for you.
You have a legal requirement to arrange for and provide an Energy Performance Certificate (EPC), which shows the energy efficiency of the property and must be provided by law whenever the property is marketed to let to a new tenant. To find a local provider of EPC’s look at our x page….
- From your bank or building society if your property is mortgaged; and
- From your insurers. It is absolutely vital you arrange a landlord’s insurance policy before letting – this covers you for claims for injury or worse from the occupants, visitors or the general public, plus malicious damage and for periods when the property is empty – usually up to 30 days.
What you need to do to let your property
- You have a legal requirement to arrange for the issue of a 12 month Gas Certificate if there are any gas appliances in the property. There are heavy fines for non-compliance. To find a local supplier of Gas certificates look at our x page…..
- Although not a legal requirement in England yet, it is recommended that you arrange a Periodic Electrical Inspection Report (PIR) from a qualified electrician before letting and every 5 years thereafter. You must use an approved registered electrical contractor to comply with Building Regulations and it is also recommended that all portable electrical appliances be tested prior to each tenancy. This called a P.A.T. test and can quickly be carried out.
- Make sure your tenants are safe by installing and maintaining a smoke detector and if there are gas appliances, a carbon monoxide detector (this is not a legal requirement but is regarded as best practice). Properties built after 1992, will have automatically been fitted with smoke detectors wired into their electrical circuits. They will in addition have a battery fitted. The smoke detector should be cleaned at least annually and the battery backup changed as necessary. There is no obligation for properties built prior to 1992 to be fitted with smoke detectors. Landlords offering a property to three or more tenants should seek advice from their Local Authority Environmental Health Department to meet the more stringent fire safety equipment required in these cases.
- If you are letting out the property furnished, the Furniture and Furnishings provided must comply with current fire regulations. You are not liable to check furniture provided by tenants, only the furniture you provide as a landlord. All must meet safety standards as per the Furniture & Furnishings (Fire) (Safety) Regulations 1993, which you can check by looking at the fire safety labels.
- Do your own safety, security and maintenance inspection / risk assessment report for the whole property making sure there are no obvious dangers such as lose stair rails and treads, slippery surfaces, faulty locks on doors and windows, faulty electrical cables and plugs, sockets, wrong electrical fuse types, blocked gutters and rains, items needing decorating / painting etc. Having written evidence that you have carried out these checks could be a life saver in the event of a claim.
- Thoroughly clean the property and remove any items which you value or could cause a danger to anyone in the property. Don’t leave any more appliances than are necessary or agreed with the tenant/s.
What you need to do to move someone in
- Pre-Tenancy Processes – for new tenancies starting on or after the 1st of October 2015 new rules apply.
- Right to Rent checks – you must make sure the applicant tenant has a Right to Rent – passports, visas etc. How do we help them with this?
- Tenants must now be served with a valid EPC, Gas Safety Certificate and latest Government provided “How to Rent Guide” – see here You can serve this by e-mail if tenant has agreed in writing to accept documents in this way – our tenancy application form takes care of that – read the notes on this form (does it?).
- Deposits must be protected within 30 days of taking them and a statutory deposit notice (s213) notice served – get proof of service for all these docs. The notice is available from you deposit protection agency’s website.
If you miss any of these steps you will be unable to use section 21 eviction process, which would cause you no end of hassle if you do. Letting has got a whole lot more complicated since 1st October 2015.
Carry out Credit Checks and Referencing on the prospective tenants and do the same with any tenant guarantor you decide to involve. If you buy our x or y package this is included….
Prepare the paperwork ready for signing: the Tenancy Agreement, Inventory, Deposit Protection Details, Check-in Checklist. We can do all this for you, see ……
Arrange a check-in meeting at the property where you will carry out a full check-in procedure. Use the Check-In Checklist…...
Conduct an inventory check with the tenant/s or arrange for a separate inventory report with an independent inventory clerk.
Provide your tenants with a property guide, a file which gives the tenants all the information they need about the property including the location of all stop taps, fuses, switches, alarms and operating / safety instructions for all appliances.
Arrange with your tenant to set-up a banker’s standing order for rent payments direct to your bank account. We can do this for you…..
If you take a deposit make sure you protect it within 30 days of receipt and serve the statutory deposit notice on the tenant/s – make sure you get proof of service. You are subject to a fine if you do not comply and you won’t be able to evict your tenant using the s21 procedure. www.thedisputeservice.co.uk www.mydeposits.co.uk www.depositprotection.com
What you need to do once you have a tenancy in place
- Once you have let your property and the tenant has checked in, immediately write to the local council informing them about the new tenant for council tax purposes. Also write to all the utilities suppliers with meter readings where appropriate so they can apportion bills for you and the new tenants: water, gas, electricity etc.
- Monitor your bank account for rent payments throughout the tenancy. Or let us do this for you…..
- Arrange for annual gas safety certificate checks when they become due again. If you use the My-Let system, it will monitor this for you and provide you with reminder x weeks in advance
- If problems arise during the tenancy contact your tenant immediately and try to resolve them amicably. If they cannot be resolved quickly, such as non-payment of rent, set in motion a clear rent arrears and eviction strategy.
- Be aware they you may have on-going costs when running your rental property and you should always keep money in reserve for this. Here is a list of some of the costs to be considered when owning a buy-to-let property:
- EPC certificate – every 10 years £70 to £120
- Annual gas safety certificate – £70 to £120
- Deposit scheme fees if you use an insured scheme. The DPS custodial scheme is free
- Legal costs if you use a solicitor.
- Landlords insurance
- Void allowance – allow one month’s rent per annum in case of vacant periods.
- Council Tax and Utility Bills – you will be liable to pay this if the property is empty between tenants.
- Ground rent and service charges – if the property is leasehold
- White Goods and Furnishings – any appliances you provide must be maintained and replaced as necessary.
- Redecoration – you will need to do this more often with a tenanted property.
- Repairs – as with any property over time you will need to do general repairs and maintenance.
Remember if you treat your tenants like you would want to be treated personally and responding quickly when they have problems, you will have better tenants, likely keep them longer and avoid having vacant periods with no rent coming in – which means you maximise your rental returns!