Lettings & Management, the Basics

If you are considering investing in property, maybe a Buy to Let, or even serviced accommodation, furnished holiday lets or social housing, then at some point you have to learn about lettings and management. You can, of course, pass your property over to a lettings and management company, which is advisable, especially if it is your first exploration into property investment, but it is still worth knowing the basics.

Firstly there are two distinct services or areas to consider, finding a tenant for your property and secondly the management of the property once the tenant has moved in. As a new investor or landlord the difference between the two is important to understand. For landlords whether you are managing or have a managing agent it is important to understand the legal responsibilities, and for tenants searching for a new property this can make a straightforward process far more confusing, they need to know who to contact, who will take care of repairs and issues etc.

Finding a tenant

The first thing you need to ask yourself as a landlord is who is going to find me a tenant?

Have you got enough time and the resources to find a suitable tenant?

You have to advertise, network, show prospective tenants around the property (if its long term tenants you are looking for), maybe reference check them. Then for ASTs you have to draw up the tenancy agreements and all the relevant documentation involved in setting up a tenancy. You have to protect the deposits paid with a relevant approved scheme, you can read more here on the gov.uk website about tenancy deposit schemes and the law.

(https://www.gov.uk/tenancy-deposit-protection)

Have you got enough time to manage the property once a suitable tenant is found?

Management

Management of a rental property involves the on-going management of your rental property, which includes, but not limited to, collecting the rent as and when required, being the first point of contact when an ermergency happens (and it can and will), doing property inspections to check the condition periodically, in the case of stls or short term lets, you need to ensure that the property is cleaned after every stay, similar to a hotel.

If the tenant requires help with repairs or maintenance, they must contact the landlord or agent directly and when it comes to renewing the tenancy at the end of the first contract period.

As a landlord, remember it is your property, so even if you have a managing agent, you are in control, and legally the contract will generally be between you (landlord, investor) and the tenants, so although an agent may be looking after the property the landlord will be legally responsible for the property. Although for a first time landlord this may sound scary, there are many great letting agents out there, and finding a good agent can free up your time and energy, removing any stress from you to look after your investment. Think of a letting agent like a stock broker looking after your stocks and shares.

Responsibilities of a landlord/agent are to:

Provide deposit protection

Ensure the property condition is in a liveable standard and free of any health hazards

Dealing with the legal safety aspects required to rent your property - Gas Safety Checks (annually), fire safety standards if its an HMO, ensuring the furniture meets regulation, installing carbon monoxide detectors and fire alarms where required, electrical equipment must be safe to use and maintained

You have to provide an up to date EPC for the property for each new tenant

Ensuring the tenants have a comfortable stay during their tenancy, whether it is one night, 6 months or 2 years.

For AST tenants you must give them a copy of the How to Rent checklist at the beginning of their tenancy.

HMOs bring with them their own set of regulations, licencing and issues and our HMO guide is worth reading.