Hello and welcome back to our blog series for beginner landlords. After all, everyone starts somewhere, and sometimes you might need a little support. This series is designed to give first-time landlords a head start, by helping you understand what you need to know about being a landlord, and some things you need to get sorted before your first tenant sets foot in your property. If you’ve not read part 1 of this series yet, you can find it here, and we suggest you start out there. If you have read it, then let’s get into part 2!
Reference Potential Tenant’s
Once your viewings are done, you will likely have a few people interested in moving into your property. But before you say yes to anyone, it’s important to do your research. While doing reference checks on tenant’s isn’t a legal requirement, it is an important step and can help minimise risk to you and your property. A reference check usually involves checking all of the tenant’s basic information, as well as previous or current employment details, addresses, bank statements, and references from their current landlord. This gives you a better picture of who they are and what kind of tenant’s they are likely to be. It’s important for landlords to make informed decisions about who they let live in their property, and referencing allows you to do this. Usually, your estate agent can help you with this, or even handle it all for you.
Arrange a Tenancy Agreement
If you’re happy with the references, it’s time to draw up a tenancy agreement! Once a tenant agrees to rent your property, you are legally required to supply them with a tenancy agreement to read and sign. This is the official contract that gives the tenant the right to live in your property, and you the right to receive rent from them. It’s also where you can detail the responsibilities of each party (like your responsibility to keep the property in good repair, and your tenant’s responsibility to pay rent by a certain date). The most common type of tenancy agreement is an Assured Shorthold Tenancy, or AST. This includes the basic information of the tenant, landlord and property, as well as the proposed dates and duration of the tenancy, a breakdown of payments and required notice periods of termination from either party. This agreement is crucial, as it is your legal recourse if something was to go wrong. There are other legal documents you need to issue alongside the AST, as mentioned in Part 1, so do your research to make sure you’re not caught out later.
Take out Landlord Insurance
With property, things will sometimes go wrong, and expensive repairs may need to be made. Whether it’s an electronic appliance failing, or events outside of the landlord or the tenant’s control (like flooding or fire), you need a plan to handle these unexpected costs. This is where landlord insurance comes in. Landlord insurance will cover a variety of options, from buildings and contents, legal expenses and rent guarantee, so you can choose the cover type that suits your needs. Ultimately it should protect you from those big, unexpected bills, and help you keep your property safe and secure. While landlord insurance isn’t a legal requirement, it’s quite often a requirement of buy-to-let mortgages, which is why we recommend every landlord takes out some form of landlord insurance.
Protect Deposits
Every landlord in the UK is legally required to put the deposit they get from their tenants into a Government-backed tenancy deposit scheme within 30 days of receiving it. This is for the protection of the landlord and the tenant, so that if there is a dispute, the money is held by a neutral third-party who can help resolve it in a fair way. There are currently three Government-approved schemes, which are:
You will also need to do your research before you charge a deposit, as since 2019 there are strict limits on what you are legally allowed to charge your tenant’s. For more information on that, just get in touch with our team.
Do a Deep Clean
This might sound obvious, but it is something that is often overlooked in the mad rush to get tenants in the door. Making sure your property is clean and tidy will not only make it much more appealing to your tenants but will help you ensure you haven’t left any personal items in the property that need removing. It’s also a great opportunity to check for any small problems or repairs that need doing, and to generally make sure your property is in tip-top shape. It helps ensure the property is left in great shape at the end of the tenancy.
Do an Inventory
Once all the I’s are dotted and t’s are crossed, your property is clean and everything is ready to go, you will need to carry out an inventory. This is the last step before moving your tenant in, and it helps you make sure everything has been accounted for, and minimises the risk of disputes when the tenant’s move out. An inventory should be a detailed document including photographs of the property, of any existing damage and of any items in the property before move-in. You can do inventories yourself, or ask your letting agent to help you out.
We know that’s a lot to take in, but don’t worry! We’re here to help. A good letting agent will guide you through every step of this process, so you don’t have to do anything alone. At Northwood, our dedicated agents are on hand to help you understand what you need to do, and support you in becoming a landlord for the first time. If you would like to know more, just get in touch with the team today.
