By being a landlord, you create a passive income with benefits of tax deduction regarding property repairs and trip expenses used for business purposes. But before renting your place out, know first what you should expect when you become a landlord.
According to the website of the UK government, there are certain certificates you must provide to tenants to ensure the safety and competency of the building to function.
- A landlord must provide a copy of the ‘How to rent: the checklist for renting in England’ – it may be in PDF, email or printed form.
- Tenants should know if the property has a gas safety certification. This document is submitted at the start of occupancy and 28 days within the annual gas safety check-up.
- If the tenant provided a deposit, make sure that you secure it using a government-approved system within 30 days.
- Unless you plan to make the area into multiple occupation homes, you must provide an energy performance certificate with a minimum score of EPC Band E.
- All electrically-powered appliances should have a record of regular check-ups every five years, to confirm that everything functions properly.
- Provide proof of working emergency and smoke alarms.
Responsibilities as a landlord
The following are responsibilities shouldered by the landlord:
- Every floor of the building should have smoke alarms installed, and carbon monoxide alarms for rooms using solid fuels.
- Regulate the supply of gas, electricity, and water.
- Amenities provided should be maintained
- Responsible for repairing most of the building’s problems.
- Acquire a licence for the property, unless it’s not licensable.
- Covering the cost of damage caused by flood and fire within your property.
Operating the business
- Permit and licence requirements. The rules and regulations you must comply with depend on the property’s location. While the local council regulates leased items in England, other parts of the UK follow the local parliament, or others according to their law. All of these must be learned before becoming a landlord, to be able to establish the rights you have as the owner.
- Record bookkeeping. Have a record of all transactions done by the tenants. This way if there are complaints regarding past payments, you’ll have a list to act as a reference for answering their questions. You can do this by yourself or look for alternatives such as the services by Gerald Eve where they handle administrative work for landlords.
- Letting agents. Letting agents help with sourcing tenants and collecting rent for 10-15% of the monthly rent. There’s also an option of giving them the authority to manage everything in exchange for 15% to 20% of rental payments.
- Screening tenants. If you opt to find possible tenants yourself, screen each of them to ensure that they have sufficient financial support to pay the rent and that they can pay on time. Check their bank records, past employment, and previous landlord. Remind them of certain house rules which they must comply with if they agree to rent.
These are some guidelines future landlords can use when setting up their property for rent.