Starting out as a new landlord can be daunting. However, with the rental sector more than doubling in the UK since 2001 amid the rise of ‘Generation Rent’, more and more people are taking the first steps towards renting out a property. So, where to start? We’ve pulled together a few essential tips that will stand any aspiring landlord in good stead.
Keep it Safe
It is the responsibility of a landlord to keep their tenants safe, with failure to employ the necessary safety measures potentially resulting in fines or even a prison sentence.
Smoke alarms must be installed on every floor that is used as living accommodation, while a carbon monoxide detector must be installed in every room where there is a solid-fuel burning appliance. It is also a legal requirement to present tenants with a gas safety certificate and an Energy Performance Certificate (EPC) when they begin their tenancy.
Screen Your Tenants Properly
So, you have listed your rental property online and people are interested. Whilst this is an exciting step, it is easy to overlook the importance of screening your tenants properly.
Whether you’re renting to students or families, dreaded rent arrears can more or less be avoided with the right tenant. That’s why it pays to gain personal references and make sure prospective tenants have a credit score of at least 600. Meeting your prospective tenants face to face as part of the screening process is also highly recommended.
Stay on Top of Your Paperwork
Whilst a Direct Debit system will save you payment paperwork, there are other administrative documents that are essential in all tenancies. Keeping two physical copies and one online copy of all of the following documents is advisable.
- The tenancy agreement: the contract between you and the tenant, this sets out the legal terms and conditions that you expect your tenant to follow such as rent payment dates and tenancy length. You can download a model or template to help you with this.
- If you do not have a buy-to-let mortgage, you will also need written permission from your mortgage lender giving you ‘consent to rent’. This keeps everything ‘above board’ and avoids any trouble you could get into for renting without their knowledge.
- If you are renting your property to three or more unrelated people, e.g. a group of students, you will need an HMO licence. This can be arranged through your local council and will last for five years in England and Wales and three years in Scotland.
- Finally, if the property is fully-equipped and/or furnished, it is important to write an inventory. Whilst counting your knives and forks may not be the most exciting task, it could save you money and hassle in the long run, especially if there’s a dispute over deposit repayment. It is also worth taking detailed photos of the property in case of any damage to furniture and fittings.
Control Rent Payments with Direct Debit
The late payment and non-payment of rent is the biggest problem any landlord faces. In the UK, landlords are left £900m out of pocket every year due to unpaid rents, with 40% of landlords having had an issue with a tenant not paying rent.
One way to take control of rent payments is by setting up a Direct Debit. Once the tenant has given authorisation, the rent will be taken on the same day every month. The landlord doesn’t have to chase rent arrears, and the tenant can’t forget the payment.
Organisation is the thread that connects all of the above. Being on top of everything is the most important skill for a new landlord, and it will ensure you start off on the right foot.
At London & Zurich, we can organise your rent and deposit payments so that you have one less thing to worry about. Our Direct Debit solutions are suitable for single-property landlords as well as those with multiple properties, allowing for the addition of extra charges and slight rent increases where required.