Landlord Advice

How To Become a Landlord in The UK – Your Guide For Success

For many, becoming a landlord is an attractive prospect. Not only is investing in property generally great in the long-term, but it’s a fantastic source of residual income. However, you shouldn’t be blinded by the prospect of profits. Becoming a landlord is hard work! There is a tonne of regulations you need to follow, alongside some risks that you need to consider before throwing your hat into the private renting ring.

That’s where this article comes in. Becoming a landlord for the first time is confusing, so we’re here to provide helpful information to give you your best start in the private rent sector.

So, if you:

  • Are interested in becoming a landlord;
  • Are unsure what is required of a landlord;
  • Want to know what you’ll need to become one,

Then stick with us! 

The benefits of becoming a landlord

As you can imagine, landlords can reap incredible profits from their rental properties if they know what they’re doing. Depending on the location and type of housing, you can ask for higher rent prices. For example, if your property is based in London, then lucky you! Take a look at Homelet and compare London average rent costs to the national average. You’ll notice rents are much higher in London, due to its dense population and highly competitive market of private rents. 

Investing in property is usually a very safe long-term investment too! This becomes especially true if you’re planning on renting them out. House prices, particularly around our largest cities, have been increasing at an incredibly fast rate. So much so, that for a person on an average wage, owning property can seem almost unattainable. This is why privately letting a property has become ever more popular in recent years. And it doesn’t seem to be slowing down anytime soon.  

Getting a landlord licence

Prior to the homes act of 2018, the only properties that required you to hold a licence were HMOs. However, the homes act gave further power to councils to give them more control over the quality of private rented accommodations. This means that licensing conditions can change from one council to another drastically.

The best thing to do is check with your local council website. They usually have dedicated pages detailing the requirements and processes for licences, along with pricing (usually between £500-£700).

Acquiring a licence means agreeing to a number of conditions. This includes some safety regulations for your property while ensuring the comfort of your tenants. Now, the conditions can differ from council to council, but generally, there are some common one’s you should look out for: 

  • If your property uses gas, you’ll need to provide a gas safety certificate. 
  • You’ll need an energy performance certificate (EPC), which makes sure your property is using energy efficiently. Thankfully, the certificate is valid for 10 years.
  • A relatively new government addition, the electrical installation condition report (EICR), which ensures your electrical installations meet national standards.
  • Your property needs to be fitted with smoke and carbon monoxide alarms. They are usually cheap and easy to install, so this shouldn’t be much of an issue. 

Landlord responsibilities and regulations

Now, while we’ve gone over some of the regulations you might face, there are still a number of them that you should be familiar with. These usually come under the forms of human habitability, fire regulations, electrical and gas safety etc, which we’ll cover below. However, this is specifically for single-let properties. If you’re looking to explore the more lucrative HMOs, check our article on what HMO is.

It’s important to keep up to date with any new legislation on landlords. You can check the latest changes here.

Regardless of what type of property you’ll be letting, it is important to follow these regulations to the word. Not doing so could result in the loss of your licence! Not to mention, tenants can take you to court if they feel you haven’t delivered on your responsibilities as a landlord. All the more incentive to do things properly.

Fire regulations

Fire regulations are important, as your tenants need to be warned if a fire breaks out, but also have the means of escape. This means putting an alarm on every level of your property and making sure the exits are kept clear so residents can leave quickly.

Carbon monoxide alarms are also a must in rooms that have a useable fuel or charcoal burner. We also recommend placing a carbon monoxide alarm in your kitchen if you use gas burners. 

Gas safety checks

You will need a gas safety check every year, but they don’t cost much in comparison to the amount you could be making. This is to make sure that all gas appliances, pipes and flues are in proper working order and safe for tenants. 

Energy performance certificate (EPC)

EPCs are used to measure the energy efficiency rating of your property. You should preferably get this done before looking for potential tenants. This is because tenants are required to be shown the EPC before they can begin renting. 

It’s important to note that as of April 2020, all tenancies need to at least have an ‘E’ rating or above. The ratings go from A to G, A being the highest, so there is no need to ensure your property is completely efficient. We also perform an EPC service, so you can check with us if you haven’t got one already!

If you need to improve your property’s efficiency, you can do this by installing double glazing, putting in loft insulation or replacing your boiler with a more efficient one.

Electrical safety

You need to make sure the electrical installations and appliances are completely safe to use. Strangely, there isn’t any regulated inspection requirement for this, so it is entirely up to you. We do recommend it, however, as if someone does get hurt because of a dangerous installation, you could be held liable. 

Deposit schemes

If you require a deposit from your tenants, you need to put this deposit into one of three tenancy deposit protection schemes, which have been sanctioned by the government. This ensures that it’s handled fairly for both parties. For instance, at the end of a tenancy agreement, your tenants will get their deposit back. Alternatively, if there is any damage to the property, you can refuse to return the deposit and use it for repairs. You can also withhold deposits for cleaning if tenants have left your property in a state.

You may also like:
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The tenant has the right to rent

You must ensure that every tenant has the right to rent a property in the UK. As you can imagine, this has become doubly important since the advent of Brexit. Now every EU citizen must be checked thoroughly, to ensure that they are able to reside in the UK.

Every tenant must be checked for identification and any other documentation that is required if they aren’t a UK citizen. You need to be thorough, as if you rent out to someone who can’t legally live here, you could be liable for some heavy fines.

Responsibilities for reairs

Responsibilities for repairs usually come in the form of maintaining the structure of the property and ensuring the property abides by health and safety regulations. For instance, if the boiler goes on the fritz, or if there are sunken floorboards that tenants can trip on, you must fix it.

There are exceptions though. Like if your tenant has been negligent and caused damage to the property. They will have to carry out any replacements or repairs of the items damaged. This is why it’s important to take an inventory of your property before a tenant moves in.

If you need more information, we have a guide on landlord responsibilities for repairs, which goes into the subject much more extensively.

Who manages the let and tenants?

This can be answered in a few ways and it can depend on how hands-on you want to be as a landlord. So, let’s take a look at some options:

  • Agent for full property management This is for those who want to wash their hands of any intensive property management. While a pricey option, your property will be completely cared for, including any safety checks and repairs that need to be done. However, this isn’t necessary and can be a massive drain on your profits. Plus, you’ll still be charged even if you aren’t currently letting the property!
  • Agent to find tenants Not only is this the cheaper option, but it removes the tedium of looking for a listing. You also still retain all management of the property, including profits. Your agents will focus solely on getting you tenants and usually charge a fixed fee (around £500). This means no extra charges if it takes longer to find your tenants.
  • Manage it all yourself This is probably the toughest option but saves you money that you would have otherwise spent on the agents. You take full responsibility for everything, including finding your tenants, marketing and the maintenance of the property. Plus, you get to conduct the viewings by yourself, so you have complete control of who lives on your property. 

If you are looking for full property management, or just an agent to find you some tenants, they are easily found on the web and the high street. It’s up to you to find the best deal!

Keep in mind, if you are managing a property, you are must take care of any maintenance around the property. You are responsible for blocked drains, damage to the infrastructure, problems with the boiler etc.

More help for becoming a landlord

For those of you who might still have some questions, or need some advice on what type of property you should invest in, have a look at our podcast! Julie Hogbin is our expert of the hour, an author and business management extraordinaire, who goes over some useful tips for those new to property investment. All of which can be very helpful for the new landlords on the block. Have a look!

We can help to get your property ready to let

At Fantastic Services, we provide a variety of services that are crucial for landlords. The professionals we work with are fully vetted, regardless of the job you need to be done. We can help with: 

You can leave your rental property woes to us and focus on chasing those profits!

Need help with a gas safety certificate?

Find a professional to perform a gas safety check.

Add a valid postcode e.g. SE1 2TH

Takeaways

  • There are great earning opportunities to be made as a landlord.
  • Becoming a landlord is a tonne of work and you shouldn’t expect a return on investments with little effort. 
  • Regulations can be annoying to keep up with, but you need to be familiar with them! Failure to do so can lead to your licence being revoked! 
  • There are a number of ways to manage your property and you should choose the one best suited to you. 

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We hope you found our article useful. If you have any experience in the rental sector or have some tips of your own, please, leave a comment with us below!

Image source: Shutterstock/ Jeanette Teare

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