Top Tips For A First Time Landlord
Taking that leap of faith to purchase your first buy to let can quickly go from extremely exciting to terrifying. Some Landlords haven’t made the choice to purchase a buy to let, rather circumstances have changed causing them to rent a property and become what is known as an ‘accidental’ Landlord.
However being a landlord has come about, there is over 150 pieces of legislation for you to get your head around which is constantly being updated and tweaked.
Below are a few top tips on where to start:
Ensure the property has a valid EPC (energy performance certificate) and the rating is E or above, since April 2018 the MEES (minimum energy efficient standard) was introduced to improve the energy efficiency of rental properties.
If you aren’t sure the property has an EPC follow the below link to search by the property’s postcode.
HMO (house of multiple occupancy)
This is a property which houses 5 or more occupiers which are from two or more households. A HMO property will need a license which can be applied for via Havant Borough Council website http://www.havant.gov.uk/houses-multiple-occupation, the fee’s for the license are also on this page.
Please note to be able to rent rooms separately there are specific room sizes that need to be adhered too.
• to ensure that the floor area of any room in the HMO used as sleeping accommodation by one person aged over 10 years is not less than 6.51 square metres;
• to ensure that the floor area of any room in the HMO used as sleeping accommodation by two persons aged over 10 years is not less than 10.22 square metres;
• to ensure that the floor area of any room in the HMO used as sleeping accommodation by one person aged under 10 years is not less than 4.64 square metres;
• to ensure that any room in the HMO with a floor area of less than 4.64 square metres is not used as sleeping accommodation.
For a copy of the legislation please follow http://www.legislation.gov.uk/ukdsi/2018/9780111167359/regulation/2
A HMO property will also undergo an inspection from an officer at the council to make sure the property is compliant with the Housing Health and Safety Rating System (HHSRS), the officers will be looking for area’s such as:
• Dampness, and excess cold or heat
• Pollutants such as asbestos, carbon monoxide, lead
• Lack of space, security or lighting, or excessive noise
• Poor hygiene, sanitation, water supply
• Accidents, such as falls, electric shocks, fires, burns and scalds
• Collisions, explosions, or structural collapse.
For a full copy of the HHSRS https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/9425/150940.pdf
You have a duty of care to make sure the property is safe and habitable for tenants. If a home isn’t up to the standard of the Housing Health and Safety Rating System (HHSRS), tenants will have the right to take legal action in the courts for breach of contract. For more information please see the link http://www.legislation.gov.uk/ukpga/2018/34/section/1/enacted
Every property containing a gas boiler or gas appliances needs to have an annual gas safety check carried out via a gas safe engineer. A gas safety certificate needs be given to the tenants at the beginning of a tenancy and then 28 days after the certificate has been renewed periodically.
You have a duty of care to make sure the electrics are safe, there is currently no legislation to do an annual check but the only way to show due diligence is to get an electrician to carry out a visual safety check as well as a Portable Appliance Test (PAT).
Smoke and Carbon Monoxide Alarms
As of 1st October 2015 it became law for a rental property to have a smoke alarm of each liveable floor of a property and a Carbon Monoxide Alarm in rooms containing a solid fuel appliance. These alarms needs to be tested on the day the tenancy starts and documented.
Ensure you get some good high definition photos of the property, cut the lawn, have a few plant pots outside to give great kerb appeal. Do all those small maintenance jobs, repaint, clean or replace the carpets if necessary to give the best presentation of the property. If you don’t want to do viewings yourself you can get a Letting Agent to do these. Make sure tenants are throughly referenced before granting a Tenancy. To protect your asset get a Rent and Legal policy in place, this protects you if the tenants stop paying rent or you need to evict tenants via the court.
On the tenancy start date the tenants need to be given the following documentation:
Signed Tenancy AgreementPrescribed forms from the deposit protection serviceHow to rent guide https://www.gov.uk/government/publications/how-to-rentFull copy of the Energy Performance CertificateGas safety certificate If the property has a license provide a copy to the tenants
If the above documentation isn’t provided to the tenants upon move in, a section 21 (Form 6A) can not be served on the tenants which gives them two months notice to vacate the property.
Make sure all receipts are kept for costs incurred to do with the rental property and seek the professional advice from an accountant and what can/can’t be claimed.
Since April 2016, an extra 3% stamp duty surcharge on second and buy-to-let homes has been in place.
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.
Always seek the advice from a professional Letting Agent, Lawyer and Accountant to make sure you are compliant at each step of the way. If you do wish to go it alone, I stronger recommend you join a Landlord association.
I hope the above information has been useful, if you do have any property related questions please don’t hesitate to contact me.