THE economic downturn has led to a new breed of financial savvy landlord who prefers to manage their own property portfolio rather than pay hefty fees to letting agents, a survey reveals.
Research by leading property website: buytolet.org.uk found that many landlords are brushing up on DIY skills and slick marketing techniques - to avoid paying letting agents, which charge around 15% of rental income for their services.
‘As the recession bites a many landlords are looking at ways to cut costs, says Lee Grandin of buytolet.org.uk . ‘While letting agents will do a lot of hard work, they do demand a big percentage in return, so it is well worth learning how to fix a tap and market your property to it best advantage.
‘But be prepared to give up weekends and evenings for viewings, advertising and repairs. This might not be a good option for people who are time poor as it’s a big commitment, he adds.’
buytolet.org.uk urges those considering “going it alone” get to grips with the nitty-gritty of property management before taking the plunge.
‘Your first steps should be to draw up a legally binding tenancy agreement, otherwise known, as an Assured Shorthold Tenancy (AST), which both parties must sign. This includes details such as the length of tenancy, amount of rent and deposit details, adds Lee Grandin.
‘Drawing up an inventory is also key, he adds. ‘Always ensure you take photos proving the condition of the property before a tenant takes residence, this will protect you from any dispute over the deposit that may arise in the in the future.’
Those letting a property on an Assured Shorthold Tenancy (AST) must ensure a tenant’s deposit is kept safe in a protected scheme. There are three Tenancy Deposit Protection (TDP) schemes approved by the Government: the Deposit Protection Service (DPS, depositprotection.com ) is free and the only ‘custodial’ option, meaning the money is kept in a bank account; The Tenancy Deposit Scheme (TDS, thedisputeservice.co.uk ) and Mydeposits (mydeposits.co.uk ) are ‘insurance-based’ and charge for membership.
Gas and electrical appliances must be in good working order and you must provide a gas safety certificate to tenants proving that gas appliances have been approved by a registered engineer every 12 months. For a qualified gas engineer in your area log on to: gassaferegister.co.uk (formerly Corgi).
While it is not a legal requirement, it is also well worth installing your property with carbon monoxide alarms and inspecting sockets and light fittings every five years (hse.gov.uk /electricity).
Landlords are legally obliged to provide an Energy Performance Certificate (EPC) by an accredited domestic energy assessor, detailing your property’s energy consumption and recommendations on ‘how to make your home more energy-efficient and reduce carbon dioxide emissions’.
‘As a landlord, you are effectively a business owner and should treat your investment property in the same way by taking out good quality buy to let insurance, adds Lee Grandin of buytolet.org.uk .
‘It makes sense to prepare for all eventualities, such as a tenant injuring themselves and bringing a compensation claim against you or covering yourself against rent not being made.
‘Landlord insurance will also protect against malicious damage, water pipes bursting and accidental damage to items and electrics.’
Your buy to let property is also vulnerable to fraud, so check with the Land Registry that it not only has your property in your name, but also an alternative contact address for you. This acts as an up-to-date record of ownership. See landreg.gov.uk .
If you own a leasehold property, seek permission from your management before renting it out. Remember, any money you make from buy to let is subject to tax, however, you can claim back allowable expenses. Find out more at hmrc.gov.uk . www.buytolet.org.uk
LANDLORD’S SELF MANAGEMENT CHECKLIST
It is a legal requirement for all gas appliances to be checked for safety. As a landlord you have a duty of care to your tenant’s and rights and responsibilities for the properties you let, these include:
Repairs to the structure and exterior of your buy to let property
Upkeep of heating and water systems
Maintenance of bathroom fittings
Annual gas safety checks of all gas appliances by a Gas Safe registered engineer.
Making certain all electrics and all electrical appliances are safe.
Ensuring furniture is up to fire safety standards
For more details and comment please contact:
Lee Grandin on 0118 973 4771 email: firstname.lastname@example.org Website: www.buytolet.org.uk
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