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Accidental Landlords

'Accidental Landlords'

With the current slump in housing markets, many homeowners looking to move are now looking at the buoyant rental market, and now need to transform their family home into a money-making desirable property to let. By virtue, these are almost 'accidental landlords' – going with the market forces and finding a way forward.

Before making that leap of faith, here are a few tips to take any sting out of the tail

Getting the right tenant

Try to form a clear picture of the type of tenant you would like – and you need to do this before you market your property. For example, would you consider, smokers, pets – children? The more flexible you can be, the more likely you are to find a tenant quickly. However, you need to consider the quality of the tenant also – you should reference check and credit-check them thoroughly. If you put good quality tenants into a property you stand a better chance of the property being taken care of, and likewise, if you present your property well, you will generate the right type of interest.

Make the house more attractive for potential tenants

As a rule of thumb, properties which have been lived in by the landlord usually rent quicker than those bought for investment purposes: usually because the quality of the fixtures and fitting is of a higher standard. Do make sure the paintwork is fresh and colours neutral – and have the carpets professionally cleaned. All the things you may consider common sense are important because the temptation is to cut costs – but remember, expectations are high in the rental market at present because of the plethora of properties available.

Conduct a detailed inventory

A detailed inventory should be carried out at the beginning of the tenancy and the tenant should agree that they are happy with it soon after moving in. Use it as a check list when the tenant leaves – it often removes the possibility of arguments

Inform your mortgage lender

All landlords must have permission from their mortgage lender prior to renting out the property. This is something landlords often do not wish to do as it will usually incur extra charges from the lenders. Don't risk not being honest - it could have very damaging consequences if you are caught out!

Have you got the right certificates?

Landlords must ensure they have a current gas safety certificate and electrical safety certificates to comply with current legislation. Landlords must also have an Energy Performance Certificate (EPC) which is now legal requirement – and you will need this before you begin to market your property.

Take out proper insurance

Before renting your property a specific landlord's insurance policy is required. Don't scrimp on your policy and save so much that you have a cheap policy which covers hardly anything! Rent and legal insurance can be purchased which covers the landlord in the event that tenant stops paying rent and also covers the landlord for any legal fees resulting from going through the process of removing the tenant from the property. This may not be something you wish to think of, but it is vital. You need too take into account periods when the property may be empty – this will need specialist cover, so make sure you speak with a professional who has in depth knowledge of the rental market, because good advice at the beginning can save you thousands down the line.

And in a nutshell?

Before the 'To Let' sign goes up, you should:

>Obtain permission from your mortgage lender
>Get the correct insurances
>Open a separate bank account for the rent payments, this will help you with your tax returns
>Arrange for gas and electric safety checks
>Label stopcocks and isolation switches
>Get an EPC
>Carry out minor maintenance and decorative repairs
>Decide on the type of tenant you would like
>How long are you letting the property for?
>All furnishings need to be fireproof with fire tag visible
>Reference prospective tenants thoroughly
>Make a detailed inventory – and you could include photos
>Think about garden maintenance – do you need to organise this?
>Leave sufficient sets of keys!

Posted on 27th June, 2010