Tenants face a tough decision when it comes to finding and renting the right home. Landlords also need to make sure that their next tenant can be trusted to look after their property as selecting the wrong tenant can be a costly decision if it is misused or damaged.
The property owner faces a number of crucial decisions:
- Should I find a tenant myself or use an agency?
- Will I be able to find a long term tenant?
- How can I avoid making any costly legal errors?
- What are my tax obligations and when are they due?
- Should l manage the property myself or find an agency to deal with the tenancy agreement and property maintenance?
In most cases the landlord manages the property theirselves, hoping to find a trouble free tenant reducing the risk of maintenance needed to the property.
How to find the right tenants?
Undoubtedly, the most difficult and time-consuming task for any owner is to find a suitable tenant interested in their property. Too often, however, mistakes are made that tend to discriminate.
It’s a good idea to make sure all relevant background checks are done on any potential tenants. It is normal that you do not want to allow smokers and pet owners to rent your property.
However, a deposit can be taken and held in a deposit protection scheme at the beginning of the tenancy and gives peace of mind for any damage or misuse of the property.
The main issues that can take a long time to settle are:
Household bills must be paid by the landlord for the previous month and then it will need to be paid as the lease agreement stipulates. There are two options – the tenant personally pays the utilities or they are included in the lease. The main bills included in the monthly rent are electricity, gas or oil, water, internet and television license.
Of course, any outstanding payments from any previous tenants wouldn’t be chargeable. In the case that the contractual relationship indicates a personal payment of utilities by the tenant any initial subscription fees (for example to a new Internet Service Provider ISP) electricity, water, gas would need to be paid for what is used during the respective months of the contract.
Under this option, the owner has fewer obligations, only to check if a regular payments are being made.
The landlords rights with regard to repairs and maintenance –
Respecting your legal responsibilities to the tenant – they are mandatory and legally defined. These can be dealt with by a property management company or personally by the landlord. Responsibilities vary – all the rights of the tenant must be provided and respected, the property must be available at the agreed time and to the standard agreed before moving in.
The appliances must be checked and operational with all the electrical checks done by a qualified electrician with the documentation to prove the checks have been done and when.
The landlord is required to provide security from a safety point of view – that there are no water and gas leaks that can endanger the tenants health, and that all locks are working and all keys are provided. Keep in mind that as a landlord you do not have the right to visit your property for at least the first 3 months, but that does not exempt you from paying for certain emergency repairs. These are in exceptional circumstances.
The landlord or hired manager must obtain information from the tenants about the type of issue with the property. Repairs will be dealt as soon as possible if it is an emergency or something that just needs to be dealt with as quickly as possible.
In some cases, it takes time to book in the relevant trades people or order any parts needed for repair. If these issues aren’t dealt with in a suitable timescale the tenant can organise for work to be done themselves which means they will possibly pass on a large bill to the landlord.
The type of repairs include most of the water leaks, flood and fire damage, toilet and roofing issues, dangerous electrical issues, gas leaks and other emergency issues. In these cases the tenants and the property could be at serious risk.
Change in Rent
Every owner wants maximise their rental income, but factors such as loyalty and a longer term tenant need to be factored in. Normally after a long term rental for a set price, the landlord may wish to increase the monthly instalment.
Everyone has the right to a return on investment, but there is a legal part to be respected by the landlord. Typically, for a 12-month lease, the increase can be made after it expires.
In the case of unlimited rent, the rent may be increased after 6 months with a 2 month notice period. Keep in mind that the procedure is cumbersome and involves additional costs. This means committing and losing income over a period of about 6 months a year
The tenant becomes unemployed
This situation is one of the most unpleasant for both parties to the deal with, especially if it is in unforeseen circumstances. The person involved in this process must have a good legal knowledge in this situation.
The clause for this issue has to be followed very precisely. However, the tenant has protection in this situation to remain in the property, so some basic things need to be checked. The reasons for the termination of the contract, the manner of providing the official notice and the notice period must be followed clearly.
Reasonable reasons for terminating a relationship on the part of the landlord are non-payment or untimely payment of monthly rent, lack of good maintenance of the property etc. A property checklist must be carried out by the landlord or property manager to make sure any damage or misuse is recorded so a claim can be made against the tenants deposit which is being held.
Top 8 tips for renting a home
● Check potential tenants – credit history, previous landlords recommendations personal conversations are important factors for agreeing new tenants and entering into contractual relationships with them.
● Prepare suitable documentation and make duplicates – each point in the lease must be prepared with precision, and be sure to include a checklist. Each element must have signatures and be available in an official written document.
● Take a security deposit – this guarantee will give you some more peace of mind in terms of preserving the condition of your property.
● Prepare your property – you need to provide a good quality living environment. This means safe habitation, repair of all sewers, appliances, electrical and gas systems, and be clean. Аn end of tenancy cleaning service after the previous tenants is mandatory to keep the property in a good state when the new tenants move in.
● Specify the payment of utilities – whether these are to be included in the rent or to be paid separately.
● Observe the property manager – make sure you are happy they are competent in their work.
● Make sure you arrange insurance – property insurance is a great way to prevent lawsuits, as well as natural disasters, theft and vandalism.
● Try to resolve possible disputes as easily as possible – meet tenants and reach agreement if possible. Try to avoid attorneys and long deeds.