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The Essential Guide for Letting your Property 2020

Introduction

As a first-timer in the business of letting property, the prospect of becoming a landlord can seem
utterly daunting. Ensuring a property is correctly marketed and let while maintaining legal
compliance can fast become a balancing act. To avoid any future pitfalls, there are a number of
issues that should be considered before putting your property on the market.

This step-by-step guide aims to provide relevant information to new and existing owners of rental
the property and should help you to better understand the process of becoming a landlord.

Selecting an Agent

The services a letting agent can provide can make much of the busy-work involved in being a
landlord disappear. Depending on how ‘hands-on’ a landlord you see yourself being, a letting
agency could be less or more involved — or even not at all.
The most commonly provided service is the sourcing of tenants. This process usually involves the
agency advertising the property, often with professional photos and a floor-plan, and later
organising viewings. The agent should prioritise finding tenants suitable for the property. A group of
students should not be placed in a family-oriented home, for example.

The agency may also provide a reference service on any would-be tenants, helping to ensure they
can meet the cost of the rent through a background check. Rent arrears are the most frequently cited
reason for eviction or tenancy non-renewal (58%), and as such, this service can do much to provide
a sense of security for any owner of rental property.

Rent collection is another common duty of a letting agent, saving the landlord from chasing late
payments from occasionally less than cooperative tenants. Some agencies may even provide
insurance service, protecting a landlord from loss of income in the event that rent is not paid.

Some landlords have an agency manage nearly every aspect of a property, including the scheduling
of maintenance, property inspections, and all communication with the tenant. It is not uncommon
for tenants and landlords in such arrangements to never meet. It must be remembered that even
when an agency manages every aspect of a rental property, the final legal responsibility still belongs
to the landlord.

Valuation and Marketing of Property

Having a professionally conducted valuation of your property is the first step in achieving the best
possible price. A valuation can often be carried out by one of our letting agents, but it could be
preferable to contract a fully independent surveyor.

A good surveyor will take a lot into account when reaching an assessment for your property. Not
only the size, condition, and layout of the property itself, but also its surrounding area, schools,
proximity to roads, and a great many other factors that contribute to your property’s full value.
A surveyor is also important in the process of marketing properly, as much of the information found
in a valuation report can help you to decide the kind of tenant best suited to your property. For
example, the quality of nearby schools could deter young families entirely or could entice those
otherwise disinterested.

It can be tricky to sell a property you do not know well, and a well-orchestrated valuation report can
make all the difference in understanding why tenants may be attracted to your property. This will
allow you to tailor your property (and it’s marketing) to a particular kind of tenant, and begin the
letting process with fewer hurdles.

Landlord’s Responsibilities

We mentioned briefly the legal duties for which landlords are responsible. These responsibilities
largely concern the upkeep and safety of the property itself, but also dictate what a landlord should
communicate to tenants.
Gas and electrical appliances must be periodically checked and serviced, along with the water
supply and heating. All furniture in the property should also be checked against fire-safety
guidelines, and for asbestos. The exterior of a property is in almost all cases the responsibility of the
landlord.

If your property is let to several unrelated parties at once, it is possible you may be required to apply
for an HMO (House of Multiple Occupancy) licenses. The point at which a property requires an
HMO license varies depending upon the rules of the local authority and can be somewhat unclear.
As a general rule, if the house is let to more than two unrelated parties an HMO is required.
Holding such a license requires the property owners to undergo a simple background check, after
which they are declared a suitable or unsuitable person. As the rules are subtly different across the
in the UK, it is always best to cross-check the precise requirement with a local expert, or the authority
themselves.

For many, the most compelling reason to become involved with a letting agent is access to their
expert knowledge in navigating the complex legal responsibilities that come with letting property.
Even when acting in good faith, it is easy to be found in violation of legal obligations toward
tenants, which can escalate to court proceedings, loss of earnings, and costly gaps in tenancy.

Tenancy Agreement and Inventory

A tenancy agreement is a form of contract between you and your tenant, specifying details of the let
(rent, minimum duration, notice requirements, etc.) and outlines reasonable expectations and rights
for both landlord and renter. There is no requirement that the agreement is written. According to the
law, a tenancy agreement can be reached verbally. However, it is good and standard practice that the
agreement is written, as doing so can help to amicably settle any future disputes. Some local
authorities offer model tenancy agreements free of charge, these offer good insight and are worth
consulting.
An inventory check should be made prior to any new tenancy, during which all contents of the
property and the state of the property itself be documented in full. This can protect you from theft
by tenants and helps in proving that a tenant is responsible for any damage to your property during
the let, allowing you to deduct from their deposit.

Taking and Holding the deposit

By law, all deposits made by tenants must be registered with a government-approved tenancy
deposit scheme. These schemes ensure that an unbiased decision is taken in regard to any deduction
you might make against a tenant’s deposit, and provide free adjudication in the event of
disagreement. If a landlord disagrees with the final decision made, the matter may be raised in
court. There are a number of services available, and choosing is the landlord’s decision.
These schemes reward clear agreements made between tenants and landlords at the outset of a
tenancy. It is therefore important to carefully document the state of the property before any move
takes place and to have a watertight tenancy agreement.

Future Prospects

Lastly, it is important to be reminded that you are not alone. Far from it.
In 2007 2.8 million UK households living in privately rented accommodation. By 2017 that number
had risen to 4.8 million households — a vast increase of 63% over a single decade. In comparison,
the total number of owner-occupied homes saw minimal change during this period.

This radical shift in the pattern of UK homeownership represents a huge growth in the rental sector,
and with the average rent, forecast to rise steadily throughout 2020 and further, this growth shows
little sign of slowing. As demand for rental properties continues to expand, greater numbers of
people are investing money in a buy-to-let property, or are letting a previously owned home. In short,
more people than ever before are becoming landlords.

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