Ian Potter, operations manager at ARLA, said: “Letting out a property can be a shrewd move whether you’re doing so for the long-term as an investment or because of a pressing need to move on.
“But renting out a property can be full of pitfalls and potentially result in financial loss for the landlord.. For example, if the right checks are not carried out, you may choose a risky tenant who defaults on paying the rent, leaving you unable to pay your mortgage.”
For anyone considering renting out their property, ARLA has the following top tips to help make the entire process as smooth and trouble-free as possible:
Do your research
Research other rent levels in your local area. And, look into legislative requirements – for example, if the property is to be used for sharers, you may require a licence from the local authority. Equally, it is mandatory for landlords to comply with Tenancy Deposit Protection legislation, requiring deposits to be protected for all Assured Shorthold Tenancies, the threshold for which changes to £100k from 1st October 2010.
Don’t go it alone
Many landlords opt to work with a letting agent either simply to help let the property, or to also manage it. Either way, it is crucial to fully-research any agent to guard against unregulated, unethical agents. A good agent should be able to help a landlord find reliable tenants, conducting the relevant reference and credit checks and ultimately helping to protect your investment. Longer term, the same agent should be able to manage maintenance and repairs, saving you unnecessary hassle. All ARLA agents are regulated, meaning they’ve received thorough training, adhere to a code of conduct, and are backed by a consumer redress scheme as well providing client money protection (similar to an ABTA Bond). Non-members may not be able to offer the same assurance.
Don’t cut corners
Make sure the property presents itself well to the market in terms of the décor, the condition of the furnishings and also the mechanics of the house – such as the heating system. A good quality property is likely to attract better and more loyal tenants, and achieve a competitive rent level. And, don’t forget to prepare a detailed inventory of the property, including a schedule of condition of the contents, walls, ceilings, doors and other fixtures and fittings – just to make sure there are no surprise claims at the end of the tenancy. Look for an inventory provider who is a member of the Association of Professional Inventory Providers (APIP), which is a subsidiary of ARLA.
Ensure you have specialist buildings and contents insurance – without a specific reference to letting you may be uninsured. And, consider taking out insurance to protect against a tenant not paying rent – a particularly sound investment in a tough economic climate.
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