As sterling stumbles, renting, rather than buying, is becoming an increasingly attractive option for those looking to live in the capital. We’re already aware that the millennial generation are doomed to never own their own home (particularly in London, where prices are 14.5 times the average income), but until the market picks back up, those who have their deposits ready and waiting are staying on the fence.
Not to mention the fact that the comparative strength of other currencies is making London an international spender’s haven at the moment, allowing foreign budgets to stretch further within the capital. As such, the market for luxurious lets has risen, with the luxury of London being more accessible than ever before.
For those who already have a property, maybe one they were thinking of selling in a better market, now could be the time to take the opportunity to become a landlord for the first time. While not without its challenges, becoming a landlord is a great way to generate additional income from a property that you neither need to live in nor sell to facilitate the sale of a new primary residence. However, before letting your property, there are a few tips that will make your life a lot easier.
We’ve chosen to focus on West London, but these suggestions can (and should) be applied by new landlords letting property anywhere in the capital.
- Choose a reputable letting agent
Nothing is forcing you to use a letting agency to manage your property, but when faced with the discerning clientele of West London, it’s a good idea to have an expert on hand to help you stand out from the competition.
There are plenty of letting agencies across the area and while it might be tempting to choose the team with the most branches, you will be better equipped by choosing a firm that specialises within a particular radius or borough. For example, independent estate agents Mountgrange Heritage, who have been operating specifically in Notting Hill and Kensington for around 20 years. The team not only have an astute understanding of how latest market changes are affecting property nearby but have an established network across the community to help you find a suitable tenant quickly.
The same logic can be applied to any area of London; choose an estate agent that can demonstrate an established connection with their location to know that you’re getting the most for your money.
- Decorate for the lifestyle of your tenants
Depending on the style of your property, its probably going to appeal to very specific residents. Whether you’re letting a modest studio on Ladbroke Grove, a terraced house in Hillgate Village, or a penthouse in Chelsea, make sure you understand who your most-likely tenants are going to be and use them to inform your interior design choices.
If your property is more likely to attract a young family than a professional couple, maybe hold off on the cream carpets. Likewise, if you’re marketing a luxury property for a high-end price tag, remember that your tenants will expect a certain degree of convenience to be included.
You might find the best ideas come from posing as a potential tenant and looking at properties similar to your own. Check out how they’re decorated, whether they’re furnished, and how much income they’re expected to generate.
- Pay attention to regulations
Preparing a letting property is very different to getting a home ready for a sale. For example, you are responsible for ensuring the property meets all the appropriate safety regulations for fire, gas and electrical hazards. For example, installing smoke alarms and carbon monoxide alarms, and ensuring all furnishings and appliances are fire-safe and electrically sound.
You will also need to consider whether your property will be classed as a House of Multiple Occupancy (HMO), and obtain a license if so. This will require a certain provision of heating, bathroom facilities and fire-safety measures – speak to your local council for more information.
- Take a security deposit
It’s common practice in the UK to take a security deposit from tenants once they have signed the rental agreement. The exact amount varies across the country, but for a house or apartment in West London you will find that a month and a half’s rent (on top of the first month’s rent) is standard. You will then need to register the tenant’s deposit with one of three, government-approved Tenancy Deposit Protection schemes.
- Don’t skip the insurance
All landlords need to have landlord insurance, which will cover the costs of all kinds of issues that can arise in your rental property. This includes everything from accidental flooding, damage to the flat’s contents or an inability to claim rent due to a problem with your tenant or the property becoming uninhabitable.
There is no standard policy for landlord insurance, so your best bet is to call several insurance specialists for a quote, and go through the details of your policy very carefully before you agree to its terms.