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First-time landlord? Here’s what you need to know.

Being a landlord can be very rewarding and lucrative, and has remained so even during the challenging times brought about by the pandemic, but it can also be challenging and complicated.

That’s why it helps to know what you’re doing in advance, particularly if you’re starting out as a landlord for the first time.

Here, using our experience as a letting agent operating across South East London, we take a closer look at what first-time landlords need to know before starting out on their journey.

Safety-first

Your biggest role as a landlord is to keep your tenants safe. This isn’t just a legal duty, but a moral one. There are a number of things you need to do to ensure the safety of your tenants throughout their tenancy, including smoke alarms on all floors of your property.

It is also the landlord’s responsibility to ensure that carbon monoxide detectors are installed in any room where solid fuels are burnt (including wood, coal or biomass), which must be tested to ensure they are working correctly before the tenancy begins.

Another priority from a safety perspective is up-to-date gas safety and electrical certificates, with copies of these needing to be provided to tenants along with a copy of the Energy Performance Certificate (EPC).

The rules around electrical safety were recently strengthened to make sure that all electrical installations are inspected at least every five years by a competent person.

Tenant-ready

The first thing to decide is whether you will be letting out your home furnished, part-furnished or unfurnished. Remember that, even if you’re letting the home unfurnished, you’ll still be expected to provide basic white goods and maybe even some furniture.

If you decide on the furnished approach – potentially appealing to younger tenants, in particular, who will be keener on a ready-to-move-into home – you should remove anything valuable or sentimental. This prevents these items being damaged and also stops tenants from feeling awkward about living in a home that is filled with someone else’s very personal belongings.

Typically, less is more when it comes to furniture – clutter is unlikely to go down well and you still want tenants to put their own mark on the property. It’s also important to remember that all upholstered furnishings must comply with the fire and furnishings act.

Another thing to bear in mind is the demographic of tenants you are looking to target. If you’re hoping for family tenants who will stay for the long term, they may have their own furniture to bring with them and will prefer an unfurnished home. By comparison, university students and young professionals are less likely to have accumulated enough belongings to furnish a house and may be glad of a fully furnished home.

Additionally, there are legal aspects to take into account when it comes to letting a property. For example, are you in an area with licensing? Is it an HMO, which has additional obligations? Is the property freehold or leasehold? And are you complying with the Tenant Fees Act 2019?

It’s vital that you are on top of all the rules and regulations in your local area, as well as factors like council tax bands, before you allow any tenants in.


Let with pets?

A major topic of debate in the lettings sector in recent times has been whether or not tenants should have the assumed right to keep a pet in their rental home. This has taken on added significance during the pandemic as a much larger number of people have become pet-owners, but the vast majority of landlords still don’t accept pets.

In fact, only approximately 7% do, according to government estimates, largely due to concerns over damage, mess, noise pollution and other potential problems.

However, with the dramatic spike in pet ownership, especially among the younger generations who are more likely to rent and the growing number of families who are making the PRS their home, are landlords missing a trick by not accepting them?

While allowing pets could make your home more desirable to a larger pool of tenants, and could also encourage tenants to stay for longer, it’s also important to note that even the best-behaved pets are likely to have an impact on a property over time and there are insurance implications to think of as well.

Despite pressure to make it obligatory, landlords are still well within their rights to refuse pets. Ultimately, it will be a very personal decision and you certainly won’t be in the minority if you decide not to allow them.

Landlord licensing

Before you let out a home, you must first check if you need a landlord license from your local council.

Legislation was introduced in 2006 with the main goal of ensuring landlords maintain their rental properties to a good standard. Working closely with a reputable, experienced letting agent will enable you to tell if you need a license or not.

EPC time

You are required, as a landlord, to serve your tenants with an EPC before the first day of their tenancy to offer them a good indication of how energy efficient your property is.

Rules introduced a few years ago made it mandatory for a property to be at least an E on the EPC band before letting it out, and there are proposals to increase this to C in the not-too-distant future.

The fines can be substantial if you are caught letting out a home that doesn’t meet the correct energy standards, so it’s a good idea to get your rental home as energy efficient as possible before you let them out.

Deposit protection

Since 2007, landlords who take a deposit from their tenants have been legally obliged to protect it in one of the three government-approved tenancy deposit protection schemes – namely the Deposit Protection Service (DPS), MyDeposits or the Tenancy Deposit Scheme (TDS).

It’s important that you protect the deposit within 30 days of receiving it and provide your tenant with both the deposit protection certificate and completed ‘Prescribed Information’.

Failure to do so could mean you are unable to evict your tenant (if ever required), as well as the full return of the deposit and a fine of up to three times the value of the deposit – so it’s not something that is worth skirting around.

Insure yourself

You might not have placed much importance on insurance as a first-time landlord, but you run the risk of invalidating your policy if you do not inform your buildings insurer that you’re letting the property out.

Typically, most standard buildings insurers will not provide the protection you will require as a landlord, as you’ll need a package that factors in more potential risks.

It’s recommended, therefore, that you take out specialist landlord cover. You should keep an eye out for policies that cover loss of rent, damage, legal expenses and liabilities. Once more, your letting agent can point you in the right direction when it comes to insurance.

Frequent inspections

Covid-19 has made regular inspections trickier, but any good landlord should aim to carry out regular inspections of a property to make sure it’s being adequately looked after. It can also help to nip any possible maintenance problems in the bud before they become something more major.

You require your tenant’s permission to enter their property, as it will be considered trespassing – and therefore illegal – if you don’t.

You should always give your tenants 24 or 48 hours written notice, which should be written down in your tenancy agreement with them so that everyone knows where they stand. While Covid restrictions have fully eased, you may find that some tenants are still self-isolating or particularly vulnerable, so you will need to tread carefully here.

The right agent

One of the most crucial parts of any successful tenancy is choosing the right agent. You need to ensure that your agent use Client Money Protection, while being part of a respected redress scheme will be another big tick. It’s good if your agent is part of a respected trade body as this can put your mind at rest that they’re a reputable company.

Of course, you should work with an agent who lists on all the leading portals to ensure your rental property gets the widest possible exposure to would-be tenants.

Here at Holland Properties, we are a member of the Tenancy Deposit Scheme and ARLA Propertymark, and follow the codes set out by Trading Standards and The Property Ombudsman.

We have been an established estate and letting agent since 1999 and can help to manage your tenancies, allowing you to get the most from your rental properties as a result. We operate in Docklands and the surrounding areas including Surrey Quays and Rotherhithe.

For further guidance on any part of the lettings process, please contact us today. You can also request a free and instant online valuation to see how much rent you could be charging in the current marketplace.

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