Key things you need to know as a landlord.
If you are already a landlord, you will know about the endless rules and regulations you have to abide by. If you are not yet a landlord but are thinking about becoming one, this article will help keep you on the right side of the law!
There are 100’s of different pieces of legislation that affect landlords and the letting of properties. Breaking these rules can result in not being able to gain possession of your property back, unlimited fines and prison sentences. You can't wing it!
A landlord is responsible for ensuring that the property is in a 'lettable' condition, with rules and regulations in place to ensure that a tenant has a warm, dry, and safe property. If your property doesn't meet the requirements, you could be forced to improve it with formal notices and legal action (consider HHSRS – Housing Health and safety rating system).
The only way to know that you are getting things right is to employ professionals, who know the laws, have completed the qualifications and deal with this every single day. This way, both you and your tenants are protected.
There are too many pieces of legislation to itemise here, however, we have put together a list of items that need consideration to enable a tenant to move in.
Getting Ready … Safety!
Gas Safety Certificate – All Gas appliances and flues need an annual safety check
Electrical Safety Report- All electrical installations must be inspected and tested by a qualified person at least every 5 years.
Smoke and carbon monoxide alarms - there must be at least one smoke alarm on each floor where there is a room used as living accommodation. There must be a carbon monoxide alarm in any room that contains a fixed combustion appliances (not a gas cooker).
Water – You must ensure the water supply is in working order.
Energy Efficiency – All rented properties need an in date Energy Performance Certificate. Minimum Energy Efficiency Standards (MEES) came into force in April 2018. This required all properties being let in England and Wales to have a minimum EPC rating of ‘E’. The government have proposed that all rental properties will need an EPC rating of ‘C’ or above by 2025.
Blinds – To prevent accidents you must make sure that blinds are safe by design and do not have any looped cords.
Furniture – Any furniture must have the fire safety labels still attached.
Bear in mind that if the relevant contractor cannot provide a pass certificate you are legally required to do any remedial work to make it safe. This could mean a large bill and maybe a delay in moving the tenant in. We would advise that you don't leave these legal certificates and checks until the last minute.
Paperwork & Compliance
Pre-tenancy checks: It is best practice before a tenancy begins to take references. Obtain copies of ID for all parties as part of this process to ensure the tenants are who they say they are. Take a landlord reference, conduct credit checks and an employer’s references to ensure the tenant can afford to pay the rent. If you plan to take our rent guarantee insurance you may need to have these checks completed by a professional agency.
Right to rent: The Right to Rent scheme requires landlords of privately rented accommodation to conduct checks on all new tenants to establish if they have a legal right to be in the UK and therefore have the right to rent their property. If the applicant does not hold a British passport, then the perspective tenant should be able to provide you with a share code. You will need to input this, along with the tenant’s date of birth on the government website. You will then have instant access to the applicants Right to Rent.
Their right to rent will either be a ‘Settled Status’ which means there is no time limit and no further checks need to be carried out, or they could have a ‘Pre Settled’ status. This means the tenants Right to Rent will have an expiry date and you would need to carry out a further check at this time.
Inventories & Deposits: The tenants Fees Act 2019 means that the deposit can only be a maximum of 5 weeks rent. There are also a number of prohibited fees and charges that must not be charged to the tenant.
Before a tenant moves in ensure a thorough inventory is prepared with dated photographs. Ensure this is signed by the tenant prior to the move in date.
Remember without an inventory it is unlikely you will be able to deduct any money for property dilapidations from the deposit at the end of a tenancy.
Any deposit money received must be protected by a government approved deposit protection scheme, for example The DPS, within 30 days of receipt.
Other things to consider.
Cashflow – You cannot rely on the tenants rent to pay the mortgage or carry out repairs. Remember you have a legal responsibility to ensure the property is safe, in some cases maintenance will need to be actioned and paid for immediately. Make sure you have a ‘float’ in the bank to cover these unexpected costs and to cover the mortgage should your tenant be unable to pay their rent. We would suggest at least 3 months rent.
Rent guarantee insurance and landlords' insurance – This can go a long way to protecting your tenant and the property. Having insurances in place can give you and your tenant peace of mind that repairs can be dealt with swiftly. And you won't have any worries about any surprise invoices.
There is a lot more legislation associated with property rental and tenancy agreements. If you are anxious about the management of your rental property and would like some help or guidance to make sure that you get it right, get in touch with our expert lettings team. We are here and ready to help!