Letting a home can be an intimidating task if you’re doing it for the first time. You may have deliberately entered the buy-to-let market to generate a steady second income, or rather fallen into it by virtue of circumstances (there are a growing number of accidental landlords who, for a number of reasons, need or have chosen to rent their homes out).
Either way, there is plenty to get your head around, particularly in terms of regulation and legislation, to ensure you are fully compliant and providing a home that is fit for habitation.
Below, we outline some top tips for those starting out in the private rented sector.
As a landlord, there are a number of rules and regulations you must abide by. This includes ensuring your home has an EPC (Energy Performance Certificate) rating of E or above when granting a new tenancy. Since April 2018, MEES (or the minimum energy efficient standard) has been in place to improve the energy efficiency of rental homes.
While the rules currently only apply to those granting tenancies to new or existing tenants, from April 1 2020 the measures will apply to all privately rented homes in England and Wales, even in situations where there has been no change in tenants. Those who fail to comply, and aren't applicable for exemption, could face fines of up to £4,000.
Since April 2016, an extra 3% stamp duty surcharge on second and buy-to-let homes has also been in place, while rules concerning mortgage tax relief have also altered in recent years. The phasing out of mortgage interest tax relief began in April 2017 and will be reduced to 25% next year before falling to 0% in April 2020.
Additionally, a few bits of new legislation have been introduced very recently which you’ll need to be aware of. Firstly, new rules concerning houses in multiple occupation (HMOs) came into play in England on October 1 2018. Now anyone letting a home where there are five or more people, forming two or more separate households, will require a HMO license. There are also new minimum space standards, with rooms under 4.64sqm unable to be used for sleeping, while landlords are also forbidden from letting rooms to a single adult where the usable floor space is smaller than 6.51sqm and 10.22sqm for a room occupied by two adults.
On the same day, further changes to the section 21 notice came into force, with changes to how and when a landlord can serve this notice.
To remain compliant and on the right side of the law at all times, it's vital you work closely with an experienced letting agent, who will be able to keep you up to speed with all the latest laws and regulation.
As well as sticking to the rules, you have a legal and moral duty to protect your tenants and provide them with a good-quality, habitable home.
If you don’t keep your tenants safe, you could face heavy penalties, prosecution or, in the very worst cases, a prison sentence.
Fortunately, ensuring a home is safe and habitable isn't difficult or expensive to achieve if you know what is needed from the outset. All plug sockets, electrical equipment and white goods must abide by safety guidelines, while you should also ensure that your boiler is serviced regularly by a qualified professional to confirm that it’s working as it should be.
You will also need to a get a Gas Safety Certificate for your property, a legal requirement that endorses the safety credentials of all your gas appliances. What’s more, you will be required to carry out an annual gas safety check – conducted by a Gas Safe Register engineer – to make sure that tenants are at no risk from their gas supply. The check will also confirm that all pipework, flues and appliances are installed and being maintained correctly.
Since October 1 2015, it’s also been mandatory for all private landlords to have at least one smoke alarm installed on every storey of their properties and a carbon monoxide alarm in any room containing a solid fuel burning appliance (for example a coal fire or wood burning stove).
To enable you to attract tenants in the first place, it’s important that your home is up to scratch. Well-maintained, clean and attractive rental homes have a far greater chance of being filled with reliable, long-term tenants.
Spruce up any garden space you have, enhance your property’s kerb appeal as much as possible, declutter to ensure tenants can imagine the home as their own, and complete any DIY or odd jobs that might make your home look a bit scruffy.
Once tenants are in place, it’s vital that you react to any maintenance issues in a reasonable amount of time. Naturally, some issues will be more pressing than others, but tenants will appreciate a quick response and the impression that their needs are valued.
A crucial part of the rental process is getting the right tenants to begin with. The chances of this happening can be greatly increased if you thoroughly check and reference your tenants’ credentials before you let a property to them.
You’ll also need to market it effectively – using both online and traditional methods – to ensure as many eyes are on your rental home as possible.
If you would rather not carry out viewings yourself, your letting agent can do this on your behalf, outlining your home’s main selling points when showing prospective tenants around.
As a first-time landlord, you will also want the security of regular, steady rental income, which is where our Rent Guarantee package comes into play. This gives you peace of mind that your rent will be paid on time every month, regardless of whether your home is occupied or not.
For more information about how we can get your home let and manage the whole tenancy process on your behalf, please get in touch with Angels Sales & Lettings on: 0800 043 6778.
To find out how much you could be generating in rent each month, you can also request a free and instant online valuation.