New landlords start here!

Read our practical advice from an experienced landlord...

Furnished, part-furnished or unfurnished?

This depends on your market, what your prospective tenants want and whether they are students or young sharers (no furniture of their own and unlikely to have more than a can opener between them), a couple or young family (some furniture of their own plus their own knives and forks), or a family waiting to buy their own property (they won’t want to pay for their own furniture to be stored). The point is that there is really no such thing as unfurnished – you’ll still need to provide carpets, curtains, light fittings, loo roll holders, shower curtains, lampshades, and basic white goods such as fridge and plumbed-in washing machine.

All furniture must comply with furnishings and fire safety regulations, so don’t even think of buying second hand. Consider buying a specialist furnishing and fittings package – they’re good value from about £3,500 for a two-bed flat, fully compliant and well thought out. Some suppliers exhibit at shows, such as Homebuyer and Property Investor, or you could try the John Lewis service.

Letting out your own home?

Tell your mortgage lender and get their consent – otherwise you could be breaking your mortgage conditions. You must also tell your home insurance company of change of use. And tell your local authority, too, as it will be your tenant paying council tax, not you – unless you stipulate otherwise.

Inventory

An up-to-date detailed inventory is essential. Do it yourself, or if you are using an agent, ask them to do it for you – they might employ a specialist inventory clerk. The inventory should note all contents and their condition and also the general condition of décor and maintenance (eg, carpet in hall unstained, small dent on front of fridge door, walls in lounge freshly painted). Clear, dated photos of rooms, floor coverings, doors and windows are all useful, possibly essential, components – and not difficult to produce in the age of the digital camera.

Two copies of the inventory should be provided to the tenants at the very start of their tenancy. The tenants should check, sign and return one copy within a stipulated time – say a week. If you do the inventory with them present, they should be able to sign their copy on the spot.

Without an inventory you could find it hard to deduct money from a tenant’s deposit if you are claiming for, say, broken windows. Update the inventory between tenants, each and every time

Electrics and gas

It is a legal requirement that gas appliances, pipework, flues and vents must be tested annually, and you must give your tenants a CORGI gas safety certificate before they move in. Landlords can be fined up to £5,000 for failure to do so, or even a custodial sentence.

There is no actual legal requirement to provide your tenants with an electrical safety certificate, but you open yourself up to similar penalties if an unsafe electrical appliance injures or kills a tenant. Since January 1, 2005, all electrical work in all homes has to be carried out by an approved electrician, and so many landlords are taking the precaution of having certified electrical checks every two or three years. A certificate will cost you around £70. Again, present a copy to your tenants and keep one yourself.

Ground rent

It is normal for the landlord to pay any ground rent or service charges on the property, so if renting out a property where these apply, make sure they are factored in.

Helping your tenants

Have a folder of information at the property for tenants, including:

• Where the stopcock, fuseboxes and meters are
• Instructions for boilers, washing machines, etc.
• Essential contact numbers – for yourself, agent, electrician, plumber, etc
• Details of rubbish collection days, and nearest recycling skips
• Handy neighbourhood information – libraries, schools, cinemas, public transport, cleaning and gardening services

Access to properties

You cannot just go into any tenanted property that you own whenever you like. Your tenancy agreement will contain a clause about allowing the tenant ‘quiet enjoyment’ of the property, without unreasonable interruption from the landlord, ‘subject to the landlord’s rights to take any lawful steps to enforce his rights against the tenant’ if the tenant breaches the agreement.

You must take the ‘quiet enjoyment’ bit seriously. Essentially, this means visiting the property only with the tenant’s agreement, and usually when the tenant is present.

It is a good idea to write into the agreement that you, or an agent, will inspect the property four times a year (which is reasonable), giving notice in writing at least 24 hours in advance. If the tenant wishes to re-make the appointment, that would be reasonable.

Make it clear also that the purpose of inspection visits is to assess the property to see if it needs repairs or maintenance, and whether any equipment or furniture needs replacing. Your tenant should be happy with that.

Make it clear that you would only otherwise visit the property in emergency, such as fire or flood, or at the request of the tenant.

Keep it clean!

Finally, keep your property tidy and the decoration up to scratch. You’ll find it easier to let, and to get better quality tenants. It may not get you a higher rent but it should help mitigate the risk of void, or unlet, periods.

Next issue of RPI: Yields and returns explained.