With so many things to consider when becoming a landlord for the first time Belvoir Lettings highlight some of the key factors to consider when approaching the market for the first time.
Below is a comprehensive list of requirements and considerations that all Landlords face when letting a property.
Important Information for Landlords
Health & Safety Requirements
Before you let your property you must make sure that it and its contents comply with various regulations including:
Furniture & Furnishings (Fire) (Safety) Regulations 1988, as amended 1993
At least one British Standard smoke alarm should be fitted in the property. Any furniture and furnishings supplied in rented property must comply with The Furniture and Furnishings (Fire) (Safety) Regulations 1988 and must carry a permanent and non detachable manufacturer's 'fire resistant' label.
Gas Safety (Installation & Use) Regulations 1988
Landlords and their agents have a statutory duty to have a safety check carried out on all gas installations and flues annually or within 12 months before the start of a new tenancy. This check must be carried out by a CORGI registered engineer who will, on completion, supply the Landlord's Gas Safety Certificate.
Electrical Equipment (Safety) Regulations 1994
There is no statutory requirement to have annual safety checks on electrical equipment as there is with gas. However, the Electrical Equipment (Safety) Regulations 1994 requires that all mains electrical equipment (cookers, washing machines, kettles etc), new or second-hand, supplied with the accommodation must be safe. Landlords therefore need to regularly maintain the electrical equipment they supply to ensure it is safe. We recommend regular checks of all electrical wiring and appliances by an NICIEC electrician. Any electrical appliances in the property must carry the British Standard Kitemark (BSI) or the European Safety Standard (BEAB).
Energy Performance Certificates
From 1st October 2008 every residential Landlord (and most commercial Landlords) are legally obliged to provide an Energy Performance Certificate, to be available to all prospective Tenants on request. The Certificate will rate your property's energy performance and make recommendations for improving it. The certificate will be at the Landlord's expense but will be valid for 10 years. We can arrange the inspection and certificate for Landlords through a government accredited Domestic Energy Assessor. The cost is normally around £70 plus VAT but please call us on with your property details and we can arrange for a proper quotation.
From 6th April 2007, all deposits taken by Letting Agents and Landlords for assured shorthold tenancies in England and Wales must be protected by a tenancy deposit protection scheme as a legal requirement. The deposit must be placed into protection within 14 days of receiving it from the Tenant. The tenant will then receive notification from the scheme providers or email that the deposit has been safely received. At the end of the tenancy, if the Landlord and Tenant agree how the deposit should be divided, they will tell the scheme what they have agreed and the money will be paid out accordingly. Should there be a dispute, the DPS will hold the amount until the Dispute Resolution Service decides what is fair.
Before a tenancy commences we obtain tenant references including a bank reference or credit search, a Tenant's personal reference, employer's reference and previous Landlord's reference where relevant.
Most tenancy agreements will be Assured Shorthold Tenancies regulated under the Housing Act 1988 with a minimum 6 month term. We will draw up the tenancy agreement as part of our fee.
It is important to have an Inventory and Schedule of Condition prepared at the start and end of any tenancy. This will prevent any misunderstandings and avoid any disputes at the end of the tenancy. Belvoir will prepare an Inventory and a Schedule of Condition at the start of the tenancy as part of our fee. The report is prepared purely on a visual basis and we do not undertake the movement of any heavy items.
You should check that you are suitably covered for letting on your Buildings & Contents Insurance. Failure to advise your insurers may invalidate your policies. Additionally you may consider optional cover including Landlord's Liability, Legal Expenses and Revenue Protection. The Tenant is responsible for insuring their personal possessions and house contents.
If your property is mortgaged you should ensure that you have obtained the mortgagee's consent to let the property.
Tax on Rental Income
You will normally be charged tax if you receive rent from letting property but can set against the rent for tax purposes most expenses arising from letting your property. Further information can be obtained from HM Revenue & Customs.
Upkeep of the Property
The Landlord is responsible for the structure and exterior of the property and also sanitary, heating and hot water installations. However, general maintenance, for instance changing light bulbs, smoke alarm batteries, keeping the drains clear, looking after the garden etc. will be down to the Tenant (unless otherwise specified in the tenancy).
Payment of Rent
We ask Tenants for payment of the first month's rent in cleared funds prior to the commencement of the tenancy and normally upon the signing of the tenancy agreement. Thereafter rent would normally be paid monthly in advance by standing order, unless an alternative arrangement is agreed with the Landlord.
Rates & Services
The Tenant will normally be responsible for paying council tax, water rates, gas, electricity, fuel oil and telephone.
During the course of the tenancy, the property may be inspected periodically by the agent or Landlord with at least 72 hours notice having been given to the Tenant.