Renting out a property – 6 things you need to know
The process of letting a property can be confusing, especially if you’re new to renting out your property. Fortunately, we’re on hand to help with the essential information – from fire and safety regulations to safeguarding your building and its contents. We’ll cover the key points you’ll need to bear in mind before letting a property and why enlisting the help of a letting agent may be the right call for you.
1. What is letting a property?
Letting a property is the term used for when a homeowner rents out their entire home or a room within a property to a tenant. One of the main reasons for renting out a property is that it’s seen as a good investment, if done properly.
2. Can I rent out my property on a normal mortgage?
No. Mortgages are given on the basis that the property will be bought for you, the owner, to live in. You’ll have to notify your mortgage lender of any changes to your occupation and get their permission to let your home if this is a short-term plan. Alternatively, you’ll have to seek out a specific buy-to-let mortgage. This is because homes used as a rental investment often run higher risks. The mortgage lender will be more inclined to want to protect their investment by charging higher interest rates or ask for a larger deposit.
Bear in mind that the incorrect type of mortgage could invalidate your insurance, which brings us to…
3. Do I need insurance for renting out a property?
Though not a legal requirement, landlords should seek adequate insurance to protect against accidental damage, like fire and flooding. Landlords are responsible for seeking consent from the mortgage lender (and the freeholder in some cases) as you’ll need adequate insurance, specific to rental properties. Failure to acquire consent will invalidate your policy and the insurance company may not pay out if there’s an accident.
Some mortgage lenders may even insist that you have landlord insurance to protect the investment as part of the contract terms.
4. Is letting a property without an agent possible?
Yes. Renting out your home privately is an option for would-be landlords and is something worth considering.
If you have the time to respond to issues at the drop of a hat and want to be hands-on and build strong relationships with your tenants, going at it alone can be a rewarding experience that can save you money in the long run.
However, this isn’t a practical solution for everyone; we’ve mentioned before that it’s a big responsibility and that managing your property is not to be entered lightly – see how a letting agent how can help. Fortunately, services like Lets Switch are available to help you decide which option is best for you.
5. What does a letting agent do for a landlord?
Put simply, a letting agent arranges stuff on behalf of the landlord. The agent gives the landlord peace of mind when it comes to dealing with the property and the tenants on your behalf.
Letting agents offer expertise and knowledge in a range of areas. It’s their job to know everything about being compliant with the law, understanding the current market when it comes to agreeing on rental income and knowing how to best advertise your home to prospective new tenants.
It’s true, agents do work on commission, but you can’t put a price on sleeping soundly – or the knowledge that your tenants are sleeping soundly in your property.
6. What must a landlord provide by law?
Renting out a property has certain legal obligations which you’re expected to uphold in order to make your tenant’s home compliant with the law.
As a landlord, you’ll need to provide and be responsible for the following:
- Energy performance certificates (EPC)
- Gas and electrical safety
- Property hazard assessments
- Smoke and carbon monoxide detectors to comply with fire safety regulations.
- Legionella assessments
- Structural maintenance of the property
You’ll also need to consider HMOs – they’re needed when three or more tenants living in one property are unrelated. If your property is home to five or more unrelated tenants who share a toilet, bathroom or kitchen facilities and pay rent, you will need a license from the local council.
If you have any questions regarding renting out your property, feel free to get in touch with us for friendly, impartial advice.Get in touch