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Top tips for first-time landlords

We all know that investing in a buy-to-let (BTL) property is a huge responsibility, but for those of you who are relatively new landlords, ARLA Propertymark has compiled some top tips, which some experienced buy-to-let landlords may also find useful, to ensure that your legal obligations are understood and that you do not risk falling foul of ever-growing legislation.

Peter Savage, president, ARLA Propertymark, said: “Whether you’ve just bought your first BTL, or you own 50, you are governed by the same rules, and with more than 145 pieces of landlord legislation, it’s worth getting up to speed with the basics before marketing your property.

“Failure to do so can result in tens of thousands of pounds in fines and potential prison sentences, but by working with a professional ARLA Propertymark Protected agent, you can rest assured that you’re compliant.

“Letting your property is a big deal, and a big decision, both for you and the tenants that will be living there, so it’s really important you understand and appreciate what it entails before you start.”

Do you need a licence?

Depending on which local authority your property sits in, you may need to apply for a landlord licence before you can legally rent it out. This system is in place to ensure all properties are maintained to a high standard, and although it was introduced in 2006, it hasn’t been adopted by all local authorities, so it’s worth checking if you need one.

Preparing your property

Get to know the area your property is in. Is it in a student area, near commuter links or suitable for a family? If you’re near a university, you should probably furnish the property, whereas if you’re near commuter links, you’re more likely to have a young professional or a family who may own furniture already.

You should consider if the kitchen or bathroom need to be updated, whether the floor coverings or blinds or curtains need replacing, and if the overall décor needs an overhaul. Some improvements don’t have to cost the earth but will make the property more attractive to prospective tenants. Other small things you could consider include installing USB plug sockets throughout the house, replacing lamp shades and ensuring the doorbell works.

Finding suitable tenants 

As a landlord, you will need to reference new tenants to check they will be able to meet monthly rent payments. An ARLA Propertymark Protected agent will be able to help you with these checks, which include credit eligibility, affordability, employer checks and any references from previous landlords. You are also legally obliged to confirm prospective tenants have the right to lawfully live in the UK through Right to Rent checks under the Immigration Acts 2014 and 2016.

Putting a contract in place

It isn’t a legal obligation to have a tenancy agreement, but it is strongly advised and best practice. A contract protects you, your property and your tenants from anything which you may disagree on such as rent payments, the deposit, length of tenancy, who lives there, whether your tenants are allowed to keep pets and how the property and anything inside it should be treated. Your agent will help you produce a legally binding contract that all parties should sign before the keys are handed over.

Tenancy Deposit Protection (TDP)

If you’re taking a deposit from your tenants, it must be protected in one of the Government-authorised TDP schemes. There are three available – Deposit Protection Service (DPS), MyDeposits or the Tenancy Deposit Scheme (TDS). You will need to protect the deposit within 30 days of receiving it and provide your tenants with the Deposit Protection Certificate and completed Prescribed Information, and the Government’s How to Rent guide. If you don’t do this, you won’t be able to evict your tenant and you might be ordered to return the full deposit and be given a fine of up to three times the value of the deposit. In order to support any proposed deductions from the deposit at the end of the tenancy, it is best practice that an Inventory and Schedule of Condition are completed at the beginning and end of the tenancy for comparison. Taking photographs is a further safeguard.

Energy Performance Certificate (EPC)

Your property must be at least EPC band E before letting it out, and you have to serve your tenants with an EPC. If you arrange a tenancy without ensuring your property is up to these standards, you could be fined up to £4,000.

Safety checks

It’s your responsibility to ensure the property is safe for your tenants, and as a part of this, you are legally required to get all gas appliances checked by a Gas Safe registered engineer every year. You must then provide tenants with a Gas Safety Certificate within 28 days of the annual check taking place.

You also need to ensure there are working smoke alarms fitted on every storey of the property from the start of the agreement, and carbon monoxide detectors must be in any room where solid fuel is used – both alarms must be tested on the first day of the tenancy. Though not compulsory, it’s recommended to install carbon monoxide detectors where gas appliances are present.

Maintaining the property

You should open a line of communication for your tenants at the start of any agreement. If you have an agent managing the property on your behalf, ensure contact details have been exchanged and if you’re managing it yourself, be clear about the best way to reach you, and how long they can expect to wait for a response on both basic repairs and more urgent issues.

Inspections

Although it’s your property, it’s illegal and classed as trespassing if you enter the property without your tenants’ permission. Best practice is to give them 24- or 48-hours’ written notice, and this should be stipulated in the tenancy agreement. If you don’t receive a response, you shouldn’t enter the property.

Landlord insurance

You risk invalidating your buildings insurance if you don’t inform your insurer that you’re renting the property out. Most standard policies don’t provide the protection you require as a landlord, so it’s worth taking out specialist landlord insurance. A good policy will cover loss of rent, damage, legal expenses and liabilities.

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    So it's illegal for the landlord to enter his own properties without the tenants' permission. What about tenants staying on without landlords' permission and not paying rent?

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    I was told by my solicitor that I had illegally evicted tenants, because they had told me they were leaving, but hadn't handed the keys back.
    I changed the locks and I was proved right, as they never handed them back, so I would have been waiting forever for this to happen, with an empty property and no income.
    They failed to pay the rent anyway and left no forwarding address.
    I had an email from them at the time, stating that they were leaving on a particular day, so as far as I was concerned I was covered.
    My advise for anyone considering BTL, don't bother, it's too much hassle now.

     
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    If you recieved an email from them saying they were leaving Your property and that their tenancy would be finished on that date which you would have confirmed the same then i believe your solicitor has got it wrong.
    They have vacated with no forwarding address? Have they informed council re council tax? Have you informed council that they left as per their email ?. Always cover yourself, but i still think your solicitor has got it wrong.

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    Hi Steve.
    When I explained the situation to the solicitor, she did agree that I had the email as evidence that they were leaving.
    Makes you wonder though, whose side they are on, because I refused to use one particular solicitor as he seemed to be on the side of the tenant from the start?

     
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    Hi Marc De Silva what a load of old tosh, what Planet are you on, is there no equality before the law of taking advantage of fellow human beings

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