If you have gone through all the hard work of investing in property to make the most of your money, then you need to ensure that you become a landlord in the right way. If you make a hash of it, it could land you out of pocket. This is clearly the exact opposite of what you want to be doing. However, doing things the right way means that you may be able to expand your empire sooner than you think. So, for anyone out there who is considering this avenue as a real possibility here are some things you need to think about:
You May Need a Licence
The best thing you can do when you start this process is to call the local council and find out everything you need to know about the rental market in your area. The most obvious is whether you need a licence or not. Once you find out the legal rules around renting houses out, you can clearly get started as you mean to go on.
Landlord Insurance
You will want to go with an insurance policy that covers you for everything, just in case. It needs to be inclusive of legal expenses and king of liability. You will definitely want damage to the property covered, as well as any potential non-paid rent.
Conduct Tenant Checks
If you skip this stage, you could be stung in a very unpleasant way. Perhaps the person is using a fake I.D. or maybe they have no money and make a habit of never paying their rent, or maybe they totally trash your house and disappear. By conducting the right tenant checks initially, you will save yourself a whole load of stress down the line. Remember, if you don’t do the right check, don’t assume insurance will cover you because you would not have held up your part of the bargain.
Safety Checks
When it comes to renting a property, you must do a whole range of safety checks. Again if you don’t do these, your insurance is unlikely to cover you. You must provide a gas safety certificate for the central heating to show that it is not dangerous. Also, regular gas-safety checks need to be done by a gas-safe engineer. You need Property Certificates to prove the electrical safety of the rental home. You will need to put up smoke detectors as well as providing many other safety features. So please check with the council or a property solicitor to make sure you have everything covered.
Deposit Protection
The Government now requires that all landlords protect their tenant deposits in a deposit protection scheme. You are not allowed to hang on to it anymore. This is a way to protect your tenants in the event that you suddenly become insolvent or something. It also protects you against any rouge tenants claiming their deposits have not been refunded, for example. As soon as you have protected your tenants’ deposit, you have to provide them with the associated certificate.
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