Whether you are renting out a residential property for the very first time or adding another to your portfolio, it’s a demanding task that can be made much easier with a simple to-do list. Carefully undertaking a series of checks – and fulfilling all your legal obligations – will mean that both you and your tenants are protected should anything go wrong.
What to do before your tenants sign a contract
Make sure you have landlord insurance. Although not a legal requirement, it can cover a number of eventualities depending on the policy. It will cover the structure of the building itself and protect against accidental damage to the property inside (especially important if partly or fully furnished). Landlord insurance can also protect you in the face of non-payment of rent by tenants and any legal expenses incurred by a dispute.
Undertake a ‘right to rent’ check. Under the Immigration Act 2014, landlords in England must check that any new tenant has the right to rent a property – and failure to do so can result in a fine of £3,000 per tenant. You must check that any adult tenant will live in the property as their only home, and ask all tenants for the original document (usually their passport) that shows they have the right to be in the UK. Once the validity of this document has been checked, a copy must be made, dated and kept.
Conduct proper tenant referencing. This allows you to ensure the tenant has the means to pay their rent on time. There are organisations that can conduct referencing on your behalf, and it should include employment history, address history, a credit check and a previous landlord reference.
What you must do for your new tenants
Provide a comprehensive tenancy agreement. This document will clarify legal rights for you and your tenants by outlining the responsibilities of both, as well as rules and conditions of the tenancy. The most common type, known as an Assured Shorthold Tenancy (AST) agreement, should outline the exact payments required, the tenancy length and the required notice period for either side to end the tenancy.
Place the deposits in a Tenancy Deposit Protection (TDP) scheme. It is a legal requirement to put deposits into a government-approved scheme within 30 days. Otherwise, you could face a fine of up to three times the deposit amount. There are three you can use – Mydeposits, Deposit Protection Service and Tenancy Deposit Scheme. Make sure you give your tenants a copy of the TDP certificate.
Give them a copy of the ‘How to rent’ checklist. Compiled by the Ministry of Housing, Communities and Local Government, this can be found on the government’s website. However, it’s not enough to send your tenants the link – you must either print out a hard copy or email it as an attachment.
What you must do at your property
Carry out a full fire and gas safety check. Ensure smoke alarms are placed on every floor of the property and are properly tested – failure to do this could result in a £5,000 fine. Any rooms containing fuel-burning devices must be fitted with a carbon monoxide detector (this is a requirement in order to get landlord insurance). Make sure a Gas Safe registered engineer carries out a full safety check on any appliances at least annually, and give tenants a copy of the gas safety check record as soon as they move in.
It’s also up to you to ensure any furniture provided is flame retardant. Additionally, in any HMO (house of multiple occupancy) a full fire risk assessment must be performed and fire extinguishers must also be provided.
Get an Energy Performance Certificate (EPC). This is a requirement and needs to be updated every ten years. An EPC gives an assessment of how much property an energy uses and how much this typically costs – giving an energy efficiency rating from A to G. In order to get one, you will need an accredited assessor to visit the property.
Test all your electrical appliances. Get an electrical engineer to fully check any appliances, switches and light fittings in the property – and make sure anything that fails to meet standards is replaced or removed before your tenants move in. Not only will this help ensure safety, but failure to do so could impact your insurance.
Complete a comprehensive inventory. From the condition of the walls to the contents of the cupboards, clear photographs and a written record are essential for minimising the chances of conflict at the end of the tenancy. Without a signed inventory, you will not be able to make deductions from the deposit to cover any damage if these are disputed by your tenants. You can do the inventory yourself, but it might be worth using the services of an independent provider to make sure it’s done properly.