Starting as a landlord can be daunting. There is an unbelievable amount of legislation and best practices to keep track of for someone starting in the business. Letting a property is by no means easy. As a Landlord, you should appreciate and understand that the legislation around letting in England and Wales heavily favours tenants rather than landlords. This document is in no way exhaustive, and a landlord should always seek professional help and advice.
As a Landlord, you should know what you are doing. There are over a hundred different pieces of legislation which relate to letting properties! In order to rent out your property, you will need to educate yourself on this legislation. If you fail to comply with any laws relating to letting accommodation it could lead to substantial financial penalties or in severe cases a prison sentence.
Points to remember before letting a property:
The Property
Gas Safety Certificate – Any Landlord must have a current Gas Safety Certificate by law. You will need to ensure that it is renewed each year on expiry by a Gas Safe registered gas engineer. You must provide the tenant with a copy before they move into the property and update them with any additional certificates you acquire over the course of the tenancy within 28 days of the inspection.
Energy Performance Certificate (EPC) – An energy performance certificate provides a measure of the energy efficiency of a property. The tenant must also have a copy of this certificate. An EPC is valid for ten years. Just for your information, any properties in the poorest energy efficiency bands of F and G will not be allowed to let them after April 2018.
HMO Licence – If you intend letting out rooms to individual tenants you should check on the local Council’s website in case you need a HMO (House in Multiple Occupation) Licence. (We’ve written a blog post on this if you need some further guidance …. http://bit.ly/LondonSharedHMO
The Tenant
Deposit – if you are asking a prospective tenant for a deposit, be aware of the legal requirements to protect the tenant’s deposit in one of the deposit schemes and give the required documentation to the tenant, and anyone who paid toward the deposit, within 30 days of receiving the deposit. Failing to protect the deposit within that 30 days has severe consequences for a landlord.
Proof of Identity:
- Proof of identity, a passport or driving licence should suffice.
- Immigration Right To Rent check this should be completed before signing the tenancy.
- National Insurance number may be useful in the future.
Credit Check – Always do a credit check to see if your tenant has a good credit history. Make sure you get the tenants to consent to this as it is a requirement of credit check companies.
If your prospective tenant is coming from abroad, you may not be able to do carry out a credit check. You may have to consider asking for the whole of the rent upfront for the fixed term. From experience, we would also recommend that you take references from their current landlord and employer.
Recruiting an Agent
It is just as crucial that the agent you appoint goes through the same level of checks as your tenant. After all, they may well be looking after one of the single most valuable assets you own. Below are a few recommendations from us, to ensure your property will be in safe hands.
Does the agent have a postal address?
Exercise a degree of caution if only a website or PO BOX address is available.
Is the agent clear about their fees?
Make sure you check their fees before signing any contracts. Lettings agents must display their fees clearly on their website and in their offices. As with any agreement, make sure you read it carefully before you sign it.
How many years has the business been established?
This may seem obvious, but it helps to determine how long the agent has been in business, this will ensure you avoid the “here today gone tomorrow” agent because those agents may disappear with your money. We would recommend a minimum of three years in business.
If you would like any more guidance on renting out your property, we are on hand to help you with any questions. Please do not hesitate to get in touch with us.