Tue 19 Sep 2017
With the government imposing regulations on landlords, it is important to get your rental property in order before you start letting it out.
Follow our simple steps to avoid any potential legal pitfalls whilst making the most out of your long-term investmentFor more detailed advice please get in touch with us
A good lettings agent can be worth their weight in gold, especially to first-time or inexperienced landlords. They can help you decide the monthly rent to charge, find and screen tenants, draw up contracts and other important documents, take the deposit and conduct the inventory when your tenants move in. If you just require the lettings agent to find tenants and draw up relevant documents, you might be charged a one-off let only fee. However if you want them to manage the property too, fees can be charged in the region of 10% of the monthly rent plus VAT.
1. SEEK OUT A GOOD LETTINGS AGENT
Letting agents' standard of service can vary therefore choose an agent you can trust and check for hidden/ongoing fees and charges.
A must read for any property landlord: Is your money in safe hands?
2. THINK ABOUT THE TYPE OF TENANTS YOU WANTThis depends on the size of your property and also who you'd be happy to let it out to. Are you happy with small children for example? What about tenants who work from home or work nights? And will you allow smokers or those with pets?
We'd always recommend where possible that you meet your tenants before you sign the contract, especially if you have gone for a 'let only' service.
Check out the services we offer to landlords
3. KNOW YOUR LEGAL REQUIREMENTSWhilst this responsibility will fall to a lettings agent on full management, it's still worth knowing your property will need a Gas Safety Certificate, a Legionella risk assessment and an Energy Performance Certificate (EPC).
Be prepared for upcoming legal changes to EPC requirements: How to increase your EPC to an E or above
Your tenants will need to be presented with the governments' downloadable 'How to Rent Guide' and the deposits will have to be put into a recognised tenancy deposit scheme. New 'right to rent' checks mean it is now the landlord/agents' responsibility to check that all tenants have the right to be in the UK.
4. THINK ABOUT TENANCY TERMSThe standard contract between landlord and tenants is the Assured Shorthold Tenancy Agreement (AST). Your lettings agent will draw up the AST for you, however make sure you are happy with key points such as the length of tenancy and the notice to leave required from either party.
5. WEIGH UP COSTS VERSUS HASSLEDecide on whether you want to manage the property yourself or use a lettings agent to manage it for you. If you're not living locally to the property, you're a first-time landlord or have a busy job, the latter option might well be worth the money.
6. SET THE STANDARDSMake sure you give the property a deep clean this includes cleaning windows, shower heads, ovens, fridges and down behind the radiators. This is a must when setting standards.
7. COLLECT ALL INSTRUCTION MANUALSDig out all instruction manuals so the tenant has them to hand. Leave any keys they might need including a key for the gas and electricity meters.
Another thing you can do to help your tenant is to leave a page of handy hints, whether it's a recommendation for a local window cleaner or contact details of a friendly neighbour, the tenants will really appreciate this.
8. GET UP TO SPEED ON NEW TAX RULESAccidental or not, now that you are a landlord you need to know about recent tax changes which could impact on you now or in the future. The rent you get from your property will be classed as taxable income. If you are letting a furnished property you will no longer be able to claim 10% 'wear and tear' costs against your tax bill. Relief on mortgage interest is now capped for all landlords at the basic rate of 20% even if you pay tax at 45%.
As you can see there are many things to consider before putting a house up for rent. If you are considering using a lettings agent we would be happy to help.
To find out your property's rental potential and to receive advice on what to do next contact us for a free lettings valuation
"Thank you for the wonderful job the team did for us in selling "Lothlorien". Nothing was ever too much trouble! There are estate agents and there is John German, a cut above the rest! Best wishes for the future to you and all the team at Lichfield!"