Letting a property - the pivotal points
There is a great buzz around the London letting market and many landlords look to the capital for the returns and long-term appreciation prospects. Whether you’re a buy-to-let novice or a professional investor, it’s worth remembering the milestone events that constitute letting a property.
When letting a property might be the right solution
There are a number of circumstances when letting a property can be a fruitful exercise. Some of the most common situations include:
- Being left a property in a will
- Starting to cohabit but already owning a property
- Using buy-to-let as a pension alternative
- Choosing property investment as a career path
To let or not to let
If you are not renting out a property you already own, we strongly recommend professional advice when selecting a house or flat that will attract tenants and deliver the best short and long-term returns.
Hanover has the advantage of both a sales and lettings division, whose staff will closely collaborate to find you the perfect buy-to-let property. If you are intending to rent out your home with a residential mortgage attached, you must inform your lender before a tenancy agreement is signed.
Best in show
The most successful journeys into buy-to-let start with a responsible letting agent. Of paramount importance is selecting an agent, such as Hanover, registered with ARLA (the Association of Regulated Letting Agents).
All ARLA members are fully qualified professionals who must follow a strict code of conduct, thus ensuring both the landlord and tenant are protected, and that legislation is followed - health and safety, and financial requirements.
Landlords should also look for an agent who has a reputation of attracting the highest calibre tenants in an area in which the property is located. A good letting agent will also negotiate when a landlord wishes to raise the rent and will mediate should a dispute arise.
Creating a good impression
Tenants expect a well presented property just as much as buyers do, so take time to ensure the standard is exacting both inside and out. Keep rooms fresh and neutrally decorated, bathrooms and kitchens should be pristine.
Outside space can really sell a rental property, so spend some time adding colourful pots to terraces, ensure any lawns are mowed and remove weeds. Although a professional inventory will document the condition of the property, landlords can take their own photographs so they can remember how the property was offered to the tenant.
Hot list of prime properties
Reaching the widest possible group of prospective tenants will ensure a property is occupied quickly, at the best price and without a void period. As one of London’s leading letting agents we are in the fortunate position of holding a list of tenants looking for a suitable property.
If we cannot match your property with a tenant immediately, we will undertake a broad range of marketing activities both on and offline. A detailed floor plan, irresistible images and engaging particulars will form part of this package. Thanks to a long established relationship with relocation agents, corporate clients, embassies and other professional institutions we will also enlist them to help secure the best tenant for your property.
We ask the right questions
There is no shortage of tenants looking for prime london property to rent, but finding the most reliable, trustworthy occupants can be a minefield. Hanover will ask the pertinent questions of all tenants - have they ever rented a property in the UK before, when do they want to move in, who will be living in the property, if they require furniture or not and for how long they intend to rent. These questions will be in addition to our comprehensive professional referencing.
Leave the legals to us
Involving a professional letting agent affiliated with ARLA will ensure your property is let in a legally compliant fashion. Our job is to protect the tenant as well as the landlord and in that line of duty, we ensure that the many regulations and laws surrounding a rental property are met. In addition to the below, Hanover also recommends an Electrical Safety Certificate to offer further protection. Mandatory requirements include:
- An annual gas safety certificate
- An Energy Performance Certificate (EPC)
- Correct adherence to fire regulations
- Electrical PAT testing available upon request
- Working smoke and carbon monoxide alarms (a legal requirements as of October 2015)
The tenancy agreement
A let can only start with a signed tenancy agreement and its contents will govern how the tenancy is run and what may happen if either party fails to meet their obligations. As standard, a tenancy agreement will detail: the names of all people involved, the agreed rental price and how and when it’s paid, how and when the rent will be reviewed, the deposit amount and how it will be protected, the property address, the start and end date of the tenancy, and tenant or landlord-specific requirements and responsibilities, such as who will pay the insurance, service charge, bills etc.
As Hanover offers a completely bespoke service to landlords, we can alter our standard agreement to suit each individual let. Ask to include details on deposits, ending a rental agreement early and who is responsible for minor repairs.
Protecting a tenant’s deposit
Every Assured Shorthold Tenancy security deposit must legally be held in a government-authorised tenancy deposit protection scheme. Although we endeavour to run every managed let as smoothly as possible, disputes do occasionally arise. The specific protection schemes which has been chosen can impartially mediate between the tenant and a landlord so a fair conclusion is reached. The conditions set out in the tenancy agreement together with the inventory and check-out report will help govern any deposit recovery disputes.
Buy-to-let finances and tax implications
Although Hanover can give you a general steer on buy-to-let financial matters, we recommend instructing a professional accountant to create a tax and financing strategy for your investment property.
When budgeting, many landlords overlook the necessity for specialist landlords’ insurance, which covers the building and sometimes aspects of liability and contents. Rental income insurance can also be arranged.
Taking care of your property
While the tenant is expected to take care of the property and attend to small matters of DIY and ‘running repairs’, a landlord is responsible for the structure of the property, heating and hot water systems, basins, sinks, baths, sanitary fittings and other fixed features. A landlord must give a tenant 24 hours notice before entering the property unless is it an emergency, such as a flood or fire.
Hanover will carefully craft a tenancy agreement that sets out the maintenance and repair responsibilities of both the landlord and the tenant. We recommend regular, scheduled property inspections to detect unreported damage or repair issues before they escalate.
The end of a tenancy
When the tenancy period is over, a tenant will either vacate the property or ask to remain. Hanover would be delighted to negotiate a new tenancy agreement on your behalf, taking in any rental increases, should the landlord desire.
If the tenant is vacating, we swiftly conclude the check-out process, providing support and advice should a deposit dispute arise. We will do our best to find a new tenant for the property as quickly as possible, turning to our extensive database of registered applicants first.