RESIDENTIAL LETTING – A TENANTS GUIDE
Gwen Williams , Property Manager of Belvoir Property Management Bedford, details the steps a tenant should take to rent a residential property.
The rental market has seen rapid growth over the last few years as the benefits of recent legislation provide additional safeguards to both tenant and landlord. Renting is now a sensible alternative to buying, especially in the short term. It provides the opportunity to live in a safe, well maintained property, without the ties of ownership. This is especially beneficial to young people, those moving into a new area and those who move around with their work.
In addition, if you are selling your home, renting may provide two options to ease the stress. The first is to sell and then rent whilst you find your ideal house. This gives you the advantage of being outside of a chain. Secondly, you may consider renting your existing house out. Monthly rentals vary, but with town houses making about £750 plus per calendar month for a 3 bed property, rent may leave a small monthly surplus over the mortgage. Your next purchase will be free of a chain, and you have an investment for the future.
There are two main sources of property available to let. Firstly, there are advertisements placed in newspapers or on the internet by private landlords seeking to deal directly with a tenant, while the second source lies with property managers who act as agents for landlords.
You will need to choose between dealing directly with a landlord or going through a property management agency. The best idea is to telephone a selection of both types to try to find the property you want.
If you choose a good property manager, they will have already vetted the property on your behalf to ensure that it complies with the gas, electrical and soft furnishing regulations. They will ensure that the correct insurance policies are in place and will have drawn up a tenancy agreement which complies with latest legislation. A property manager cannot charge you a fee for providing you with details of property to let or holding your name on a register, but will charge you a fee once you find accommodation that you agree to rent. This fee will also cover the costs of ensuring that you are a suitable tenant.
How will I be vetted?
The property manager will run a credit check on you to ensure that you do not have a history of bad debts. This will help them to judge whether or not you will continue to pay the rent once you are in the property. If you are on a limited income, they will ask for a guarantor to guarantee the rent in the event of non-payment. They will also seek references from your employer, your previous landlord and from a personal referee. If you are self employed, your Solicitor or Accountant may need to be approached for a reference.
How much will I need to pay at first?
To reserve the property you wish to rent while references are being taken up, the normal practice is that you pay the property manager’s fee of, say £250. This may be returned if the landlord does not proceed with the letting, but may be forfeited if you subsequently change your mind. Cleared funds representing one month’s rent in advance and slightly more as dilapidation deposit will be required immediately before you move into the property. The deposit will be registered in a Government Approved Scheme and it is returnable if your rent is paid up to the end of the tenancy and the property is vacated in the same condition as you found it, fair wear and tear excepted.
What sort of tenancy will I be offered?
These days you will almost certainly be offered an Assured Shorthold Tenancy (AST) for a fixed term of, say 6 months, and many landlords will be happy to grant a further tenancy when the first one comes to an end. However, there is no set minimum period so a shorter tenancy could be agreed, at the discretion of the landlord. After the set period of the tenancy the landlord and tenant may agree to let the tenancy continue to run on indefinitely from one rent period to the next, usually on a month by month basis. This is called a statutory periodic tenancy.
When can the tenant be asked to vacate the property?
By far the most common way is for the tenancy to end amicably when either the landlord requires his property back, or the tenant decides to move on. This may be at the end of the fixed term stipulated in the tenancy agreement or it may be at a later date; in either case the landlord will have given two months notice to the tenant that he requires possession of the property. In any event, a landlord cannot evict a tenant for any reason without giving due notice and applying for a court order if the tenant refuses to leave.
Who is responsible for the bills?
The landlord will be responsible for repairs to the structure and exterior of the property, including baths, sinks, toilets and heating and hot water installations. He is responsible for checking that all gas appliances are maintained and inspected according to the law. The landlord or his agent must ensure that the electrical system and appliances are safe to use and that any furniture and furnishings meet the current safety regulations. The tenant will be responsible for council tax, water and sewerage charges and usually the payment of gas, electricity and telephone bills for the duration of the tenancy. A good property manager will organise reading of utility meters, and notify the authorities of changes of tenancy. This should all be made clear in the tenancy agreement, which the property manager will draw up for you.
What rights of access does the landlord have?
The tenant has the legal right to live in the property as his home and the landlord should ask your permission before he enters the premises. However, the landlord or his agent also have the right to enter the property at reasonable times of the day to carry out repairs and to inspect the condition and state of the property, having given reasonable notice of his intention. A good property manager will have drawn up a tenancy agreement, which states the arrangements for access and repairs. These should include giving you at least 7 days notice in writing of a visit.
A good manager will visit you within 4 weeks of the tenancy starting and then at three monthly intervals to check that the terms of the tenancy are being adhered to, and that there are no problems with the property
What happens to my deposit at the end of the tenancy?
The deposit acts as security for the performance of your obligations as a tenant under the tenancy agreement. This deposit should be returned to you at the end of the tenancy term subject to deductions to compensate the landlord for any breach of the tenancy agreement. If you leave the property in a dirty condition, the property manager will have it cleaned and will deduct that cost from your deposit before returning it to you. Similarly, if you have broken or damaged any of the fixtures or fittings these will be replaced at your expense. A good property manager will have prepared an inventory before the start of the tenancy which you will have agreed and signed and which will form the basis of the debate on how much deposit will be returned. Ethical agents will not charge for fair wear and tear.
If you follow the guidelines in this article, you should benefit from a trouble free tenancy. Not sure , have more questions pop into our office in Tavistock Street or email our Property Manager.