News
Tips for accidental landlords
Accidental landlords are individuals who rent out their own home instead of selling it, or those who have inherited a property. For many accidental landlords, the process of renting can seem daunting. However, according to the English Private Landlord Survey, 42% of all landlords entered the market accidentally. 35% originally bought the property to live in, and 8% inherited it. Therefore, many people are in the same position.
This blog provides practical tips for accidental landlords to help guide them through the process:
1. Speak to a mortgage broker
The initial step that all accidental landlords should take is to speak with a mortgage broker. This is because, with most residential mortgages, it is not permitted to rent out the property. If it is allowed, it is typically only for a limited period. Therefore, it is important to explore buy-to-let mortgages.
Once a suitable mortgage lender is found, they will carry out a “stress test” to determine whether the expected rental income will be sufficient to cover the mortgage repayments.
In addition, to qualify for a buy-to-let mortgage, it is typically required to have at least 25% equity in the property.
2. Take out landlord insurance
The next step is to consider specialist landlord insurance and home emergency cover. Landlord insurance typically covers the physical structure of the property, landlord-owned contents, liability for tenant injuries, loss of rental income, and legal disputes.
Home emergency cover is not always used by landlords who can rely on local tradespeople when needed. However, if this is not possible, the cover will pay for immediate call-outs, labour, and parts.
3. Complete landlord safety checks
Landlord safety checks are a key requirement to remain compliant with the law. These include:
- Gas Safety Certificate (annually)
- Boiler service
- Electrical Installation Condition Report (EICR) (every 5 years)
- Portable Appliance Testing (PAT)
- Energy Performance Certificate (EPC) rated E or above (every 10 years)
- Annual testing of smoke and carbon monoxide detectors
Every landlord must carry out these checks before letting a property. It is vital that tenants are provided with the EPC, EICR, and Gas Safety Certificate.
4. Decide whether to furnish the property
When renting out a property, you can choose to let it as furnished or unfurnished. This decision should reflect both the local market and your target tenants.
For example, in the Thanet district, demand tends to favour unfurnished properties due to a high concentration of families and long-term renters. A downside of furnished properties is the ongoing cost of replacing items due to wear and tear, as well as the increased management required.
Landlords are legally required to provide smoke alarms, carbon monoxide alarms, light fittings, flooring, and secure external doors. All other features are optional, depending on what the landlord chooses to provide, such as fridge freezers, curtain rails, and dishwashers. Ovens and hobs are not legally required, although most landlords do supply them.
If appliances are provided, it is important to include a clause in the tenancy agreement stating whether the landlord is responsible for repairs and replacements.
5. Prepare the property before tenants move in
It is important to ensure that everything in the property is in good working order before a new tenant moves in. This helps avoid issues for tenants and allows them to enjoy the property fully.
Additionally, some work cannot easily be carried out while the tenant is living in the property, making it more difficult to fix issues and potentially leading to further damage over time. Key preparation tips include applying a fresh coat of paint, cleaning carpets, and ensuring all surfaces are clean and well maintained.
Additional reads:
View Blog
