In this series of articles, Gwen Williams , Property Manager at Belvoir Bedford advises about the procedures involved in preparing a property for rental. This article deals with the initial steps, the next will advise about finding the tenant and moving them in.
Once you have decided to rent your home, the next step is to find suitable tenants.
Most landlords will decide to employ the services of a Residential Letting Agent and obviously will employ the agent that provides the best service for his needs with the most competitive charges and someone who will find a suitable tenant in the quickest time available. Belvoir Bedford are able to offer a bespoke service from marketing only to Full Management. Tailored to the individual needs of the landlord.
However, you should also ensure that his agent operates separate client and business bank accounts, has professional indemnity insurances and passes the rent to the landlord as soon as it has cleared his bank account and does not hold onto the rent until the end of the month.
Some landlords do not wish to use an agent when letting their property but they will not usually be able to carry out credit references on potential tenants.
However, the landlord must use a specialist solicitor to draw up a tenancy agreement which will be acceptable in a court of law should the unforeseen happen.
We can carry out a Let only service, which will provide the necessary tenancy agreements and find and vet potential tenants but leave the day to day management to the landlord.
Before finding a suitable tenant
An agent will appraise the property and using his knowledge of the local market, give a realistic rental valuation. It is better to be realistic in setting the level of rent and have an immediate response than to ask too high a rent and have a property stand empty. He should also establish what requirements a landlord may have with regard to letting his property i.e. non-smokers or no pet owners etc.
If there is a mortgage on the property, the lender should be approached for their permission to let the property. Belvoir Bedford can provide information in relation to mortgages too. Every lender has a different set of rules with regard to rental properties; some levy a charge every time a new tenant moves into the house, others make a one off charge and a third group ask only to have sight of a tenancy agreement. However, the approval of the lender is imperative and must be received before proceeding with the rental of the property.
A landlord must also establish that their insurance policies will still cover them if they rent their house as there are some insurers who will reduce or withdraw cover when a property is let. There are specialist insurances available for landlords if this is the case, and an agent should be able to provide details of these.
A landlord is required to maintain the fabric of his property, and it is a condition of most mortgages that a buildings insurance policy is kept in force at all times. We would also recommend that a minimum contents cover of £5,000 is required to cover damage to carpets and curtains.
A few agents will offer rent and legal guarantee insurance and this is strongly advised as it will cover legal costs and cover rental income should there be a problem with the tenant, ie he is made redundant or is off work through illness. As it normally takes 8 to 12 weeks to gain possession, you could loose 25% of your annual income and have to pay legal fees if not covered!
As you can see there is a lot to consider and we havent even covered the safety regulations, EPC’s and HMO’s
If you want to discuss your letting options , call in and see us or call us 01234 290685