If you’ve never let a home before, there is a lot to get your head around – especially with regards to regulation and legislation – to ensure you are providing tenants with good-quality homes and generating a solid source of rental income.
Whether you’ve chosen to enter the market to join the many other landlords already providing homes in the private rented sector, or you’re one of the increasing number of accidental landlords, there are a number of things you need to be aware of – to both stop yourself from falling foul of the law and to get the absolute most out of your rental properties.
Here, using our experience as estate and letting agents in North London, East London, Hertfordshire, Essex and the surrounding areas, we offer some top advice for those starting out on their landlord journey.
Take a safety-first approach
As a landlord, you have a legal (not to mention moral) duty to protect your tenants and provide them with a home that is fit for human habitation. This is even more important in light of the recent passing of the Homes (Fitness for Human Habitation) Act, which received Royal Assent in December 2018 and comes into force on 20 March 2019.
Originally a private members’ bill put forward by Labour MP Karen Buck, it amends the Landlord and Tenant Act 1985 to require that residential rented accommodation is provided and maintained in a state of fitness for human habitation. This page explains the Act in much greater detail.
Even without this amendment, you still have a responsibility to keep your tenants safe, with heavy fines, prosecution and (in very serious cases) prison a possible punishment if you don’t.
Achieving a safe, habitable home is something that can be achieved in a number of steps. Fire safety is a particularly important consideration, even more so following the tragic Grenfell Tower fire. Any furnishings and furniture you provide must be fire retardant and fire safe, while it’s also crucial that tenants have a number of safe exit routes in the event of a fire.
Similarly, all electrical equipment, white goods and plug sockets must meet the latest safety guidelines, and a registered professional should service your boiler on a regular basis to make sure that it’s functioning correctly.
In addition, a Gas Safety Certificate is a legal requirement for your property, endorsing the safety credentials of all gas appliances in your home. An annual gas safety check will also be needed – carried out by a Gas Safe Register engineer – to ensure that tenants are at no risk from their gas supply, while also checking all pipework, flues and appliances are installed and maintained correctly.
Lastly, it’s been mandatory for all private landlords since October 1 2015 to have at least one smoke alarm installed on every storey of their properties and a carbon monoxide alarm in any room containing a solid fuel burning appliance (e.g. a wood burning stove or coal fire).
Play by the rules
There has been a considerable amount of new legislation in recent years. With the PRS now accounting for nearly 20% of all households (nearly 30% in London), the government has sought to regulate the sector to ensure standards are kept high across the board.
As well as existing regulation, there have been a number of changes in recent times, including ones concerning stamp duty, energy efficiency, homes in multiple occupation (HMOs) and mortgage interest tax relief.
Any rental property being let as a new tenancy must have an EPC (Energy Performance Certificate) rating of E- or above thanks to the introduction of MEES in April 2018 to improve the energy efficiency of rental homes.
The measures will apply to all privately rented homes in England and Wales from April 1 2020, even where there has been no change in tenants. Failure to comply could lead to fines of up to £4,000.
Meanwhile, an extra 3% stamp duty surcharge on second and buy-to-let homes has been in force since April 2016, while mortgage interest tax relief is steadily being phased out, eventually being reduced to 0% in April 2020.
New rules relating to HMOs came into play in England on October 1 2018, with a HMO license now required for anyone letting a home where there are five or more people, forming two or more separate households.
October 1 2018 was a busy day for new legislation, with changes to section 21 notices also coming into play. The rules surrounding how and why a landlord can serve this notice are now different, with a number of up-to-date documents needing to be served to a tenant for an eviction notice to stand, as well as use of a single notice form – Form 6a – rather than the two old forms (s.21 (1)(b) and s.21 (4)(a)).
Fill your rental home with good tenants
To improve your chances of a successful, smooth tenancy, you need to get the right tenants in place. Good tenants will pay you their rent on time and treat the property as if it’s their own. They are also more likely to stay for the long-term, which is key for those seeking a steady stream of rental income over a number of years.
As a landlord, you’ll be desperate to avoid void periods (where your home is empty but you’re still paying running costs), so selecting the right tenants is a crucial part of the process.
Equally as important is maintaining your home on a regular basis to ensure it looks the part.
A well-maintained, clean and welcoming home will have far more appeal to prospective tenants. So to improve your chances of filling your rental homes quickly, spruce up any garden space you have, improve your property’s kerb appeal and give the home a once-over before putting it on the market.
When tenants are in place, you (or your letting agent on your behalf) should also respond to any maintenance issues as quickly as possible.
Working with an experienced, reliable letting agent – who can help to market your properties effectively, keep on top of regulation and ensure your home is safe and habitable – will improve your chances of smooth, pain-free tenancies.
To find out more about what we can do for you, you can contact your local Kings Group branch today. If you want to know how much you could be earning in rent each month, request a free instant online valuation.