Despite a turbulent year caused by the coronavirus pandemic, now is a great time to be a landlord.
Lockdown is easing, temperatures are rising, and demand for new homes continues to rise – resulting in a rental market boom.
Recent data from ARLA Propertymark shows the average number of new prospective tenants registered per branch rose for the third month in a row to reach 84 in March.
With demand set to continue, there is a good chance that you can find suitable tenants to occupy your property, helping you to generate income quickly. Of course, there are a number of important factors to bear in mind.
Below, leaning on information from ARLA, we list some top tips for first-time landlords looking to make the most from their buy-to-let investment.
As a landlord, you are legally required to provide a safe and secure rental property. Smoke alarms are required on all floors of your property and carbon monoxide detectors must be installed in any room where solid fuels are burnt.
These need to be tested and working prior to the first day of the tenancy. In date Gas Safety and Electrical Certificates should be a priority as copies of these must be given to the tenants along with a copy of the Energy Performance Certificate – which must have a minimum EPC rating of E.
Preparing your property
Whether you are letting your property furnished or unfurnished, think carefully about what you can provide. Ensure that you remove anything valuable or sentimental, and always remember that less is more.
You should also think about the type of tenants you want. Family tenants are likely to stay for a few years and will have their own furniture already. However, if you’re renting to university students, it’s unlikely they’ll have accumulated enough belongings to furnish a house.
Landlord license and insurance
You must check if you need a landlord license from your local council before your property can legally be rented out. This legislation was introduced in 2006 with the main purpose of ensuring landlords maintain their rental properties to a good standard.
Additionally, you will need to inform your buildings insurer that you’re renting your property out, or you risk invalidating your policy.
Most standard buildings insurers don’t provide the protection you require as a landlord, so it’s worth taking out specialist landlord insurance. A good policy will cover a loss of rent, damage, legal expense and liabilities.
As a landlord, you will need to rigorously reference new tenants to check they are reliable and will be able to meet rent payments each month. Tenant referencing covers checks for credit eligibility, employer checks and previous landlord references.
Tenancy deposit protection
Your tenants’ deposits must be protected in one of the three government-authorised Tenancy Deposit Protection schemes – 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 the tenant with both the Deposit Protection Certificate and completed Prescribed Information.
Failure to do so could result in you not being able to evict your tenant, plus the full return of the deposit and a fine of up to three times the value of the deposit.
It’s crucial to undertake regular inspections of the property throughout the tenancy. Remember that you cannot enter the property without the tenant’s permission as this is classed as trespassing and is illegal, and all Covid-19 safety measures must be closely followed.
It’s best practice to grant your tenants 24 or 48-hours’ written notice, and this should be stipulated in your tenancy agreement.
Choose the right agent
Perhaps one of the most important steps, make sure to choose the right letting agent for your needs. Researching an organisation that operates with Client Money Protection is a great place to start.
It is advisable to meet your agent before going into business with them, either in person or over the phone. A letting agent who answers within five rings will be more likely to keep on top of your needs than somebody slower on the uptake.
Fortunately, our dedicated team can offer this and more. Here at Chimneypots, we are doing all we can to help our clients during these uncertain times.
If you require further guidance on letting your home successfully in South Coast locations – such as Southampton and Portsmouth – during the pandemic, please contact our team on 01489 584298.
To find out how much you could be charging in rent each month, why not check out our instant online valuation tool?