Landlord’s Guide to Legal Requirements, Services and Inventories

Beginner's BTL Landlord’s Guide to Legal Requirements, Services and Inventories

While selecting the right property in the right area to attract the type of tenants you’re comfortable renting to are extremely important aspects of your new life as a BTL Landlord, there’s a lot more to consider, plan and execute!

These additional details include – but are not limited to – your legal obligations, the services you must provide for your tenant/s and the importance of inventories.

Landlords’ Legal Requirements

In order for you to be a law-abiding landlord and supply tenants with those things they are legally entitled to by UK Government law, there are a number of things you will need to prepare and keep certification for.


Right to rent check

Before you even think about property checks, you need to ensure your prospective tenant or tenants have the ‘right to rent’ in the UK. This is a relatively new rule which came into force on February 2016.

It is the landlord’s responsibility to:

  • check prospective tenant’s original documents to make sure they have the right to rent a property in England
  • check the documents of any other adults living in the property
  • make copies of your documents and keep them until the tenant/s leave the property
  • return the original documents once the check is complete

This is, of course, a rule which has been created in order to help limit illegal immigrants from renting a property and also to stop unscrupulous landlords from taking advantage of illegal immigrants.

The types of documents which are suitable for this include: A Passport or National Identity card showing the holder is citizen of the UK, a UK colony or a European Union National. Home Office stamped certificates showing the holder has leave to live in the UK are also acceptable as are certificates to show the holder is a naturalised British citizen. The full list of acceptable documents is available here.


Safety checks

A Gas Safe certificate is a requirement of letting out a residential property. The landlord must have the gas supply tested by a Gas Safe registered engineer who, if the supply is safe, will issue a certificate stating that. A copy of the certificate must be given to the tenant and also held by the landlord. Annual gas safety checks must also be conducted every 12 months to ensure the gas supply is safe and in good working order.

An electrical safety check must also be conducted prior to a new tenant moving into a rented property. This means the electricity supply and any appliances in the property must be tested to ensure they are working and safe to use. Complete instruction manuals must be available for all appliances and the supply and appliances must be maintained so they remain safe for use throughout the tenancy.

Energy Performance Certificates (EPCs) are another mandatory requirement for a landlord to provide. These certificates, however, are valid for ten years at a time although you can have them updated earlier if you renovate the property and make some energy efficiency improvements.

Fire safety is also paramount and it is the landlord’s responsibility to ensure working smoke and carbon monoxide alarms are present in the property – at least one smoke alarm per floor of the property. You must show the tenant the alarms are installed and working on the day they move in. It’s worth asking the tenant to sign a form to confirm they were installed and working when they moved in – provide a copy for the tenant for their records too.


Tenancy deposit scheme

Deposits are another important area. Typically, landlords require one full month’s rent as a deposit and a full month’s payment before handing the keys to the tenant.

While the rent goes into your bank account, the deposit must be safeguarded – this is a legal requirement – and there are two options.

One option is to transfer the deposit into an official tenancy deposit scheme, while the other is to keep the deposit in your own account but with deposit protection insurance. These updated options are there to protect the tenant’s deposit and ensure it is available to be returned – minus any agreed costs – once the tenancy agreement comes to an end.

 


Ongoing Maintenance Responsibilities

Aside from initial safety checks when your new tenant moves in, you are ultimately responsible for the maintenance of the property, appliances and any white goods that you have supplied. If there’s a problem with the water supply, for instance, then you will need to rectify that problem, in a ‘reasonable period of time’.

One option is to sign a management agreement with a lettings agent. In return for a percentage of the rent they will be the first port of call for the tenants if there is a problem. The letting agent will then assess the problem and arrange for a relevant engineer or appliance replacement to be sent or delivered. They will then inform you of this and bill you the required amount, which they will also receive a percentage of.

As you can see, this can turn into an expensive option if/when things go wrong. However, if you live far from the property or aren’t confident or able to either fix or arrange these details then it will be money well spent, provided your letting agent does their job well.

If you opt to manage the property yourself, there are a few ways in which to minimise the stress when things do go wrong, for you and the tenant:

  • Ensure you have the correct landlord buildings insurance just in case things go really wrong.
  • Arrange your own property maintenance contract with an experienced service provider.
  • Arrange separate maintenance contracts for each individual item – a gas engineer, electrical engineer, a plumber and a handyman.
  • Or, if you and a family member have the correct skills and certification for one or two areas, just arrange contracts for the ones you don’t possess.

If you do take on additional contracts, just as with any other agreement, make sure you read through all the details carefully and understand what you’re signing up to and paying for. If you think you’re paying for 24-hour response seven days a week but it turns out to be 48-hour response over the weekend because you didn’t read the small print and missed it, your tenant could get very upset when you can’t deliver on your promises.

 


The Importance of Inventories

Conducting or arranging an inventory may seem like a waste of time, but it’s actually an important part of the rental process. While landlords should allow for realistic wear and tear during a tenancy period, having access to a correctly taken and agreed inventory will make it a lot easier to make necessary deductions from a deposit if the tenants haven’t looked after your property well.

It also serves as a useful document if disputes over what was provided by the landlord ever arise – provided you and the tenant both agreed and signed the form when they moved in. And, once you create and conduct the initial inventory process, it will become less laborious and just another small part of the whole rental process.

Alternatively, there are companies that will handle the whole inventory process for you for a reasonable cost.


Being a ‘People’ Person helps too!

Knowledge and professionalism are also two important traits when you want to become a BTL landlord – but so are good people skills, patience and the ability to listen and understand others.

You can always research and learn about lots of different, important things but people skills and patience are harder to learn and are more of a personality element that you either have, or not. If you have patience and are willing to put in a lot of work, to listen and to learn then chances are you might make a decent landlord

Information contained in this article may have changed since it was first published. Ezylet strongly advises you to seek legal advice from a qualified professional.

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