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Essential Landlord Information

Being a landlord isn’t easy.

And new legislation seems to make it that much more complicated every year.

There’s always something coming round the corner, and if you take your eye off the ball for just one second the chances are you could be scoring an unwitting own goal.

That’s what we are here for: to act as your eyes and ears, to offer advice and to make life that much easier.

Renting properties is what we do. It’s our sole focus, our passion and our skill.

 

Khalil’s is a Brighton letting agent through and through.

Always has been and always will be.

We specialise in helping landlords let properties to families, students and professionals. Offering advice to landlords about renting in Brighton and Hove is second nature to us.

So we hope this essential advice about landlords’ responsibilities helps make things that little bit easier.

 

If you ever have any questions we are always happy to help.

  • Need a free rental valuation?
  • Need advice about the different areas in and around Brighton for rental potential?
  • Having trouble collecting rent?
  • Can’t find a tenant?
  • Wondering if there is a way to guarantee your rent every month?

Give us a call on 01273 573960 to ask us how we can help.

Or read on to find the answers to questions about landlords’ responsibilities that we’re most frequently asked. And don’t forget you can find more tips, news and views in our landlord advice blog.

Essential advice for landlords: Landlord responsibilities 

 

Should I rent furnished or unfurnished?

There is no simple answer to this.

To a certain extent it depends on the type of property you are renting, its location and the sort of tenants you are looking to attract.

One thing is certain though: a part-furnished flat or house does you no favours whatsoever.

The general demand is stronger for unfurnished rentals, though in a city like Brighton with such a high number of students furnished properties can be sought after.

If you are thinking of renting your property furnished you must make sure that everything in your property is compliant with the Furniture & Furnishings (Fire Safety) Regulations 1988 (amended 1993). This covers all items of soft furnishings such as chairs, sofas, futons, beds, cushions, seat pads and pillows.

 

Read more

Prime Location: Furnished or not – the pros and cons

Letting Council: Lettings and furniture fire safety regulations (PDF)

Do I need to get a license to rent? (Or, is my property classed as an HMO?)

A house of multiple occupation (or HMO) is a legal definition that actually fits a much wider number of rental properties than you may imagine.

It’s quite likely that, unless you are renting a one bedroom flat or a home to a family, that your property is actually defined as an HMO.

An HMO need only have three tenants living in it or be a home in which the occupants share a bathroom, toilet or kitchen facilities.

The reason this is important is that HMOs carry certain specific regulations and requirements that landlords must be aware of.

Tenants who are unhappy in an HMO can complain to the local council who will act to enforce the standards set by the government. So you need to ensure you are always on top of your game.

 

  1. Make a risk assessment

Safety checks and precautions must be comprehensively carried out. In particular fire safety precautions must be documented and a smoke detector fitted in every bedroom and communal area. The kitchen must also have a heat detector.

Gas and electric checks must be undertaken regularly: HMO landlords must have a gas check every year and an examination of their property’s electrics every five years.

 

  1. Be realistic about the number of tenants

Landlords have a legal duty to ensure the property is not overcrowded and that there are suitable cooking, washing and communal facilities for the number of tenants in their property.

 

  1. Do you need a licence?

Many HMOs must be licensed before they can be rented out. More information about this can be provided by the local authority. Any landlord who is not certain if they need a licence or not, and is considering renting to three tenants or more, should contact their council.

 

Read more

Brighton Council: HMOs

Gov.uk: HMOs

I’ve found my tenants! What do I need to do next?

Finding a tenant is just the start of the journey, but it’s crucial you set off with your best foot forward.

Here are nine necessary steps to take to ensure you get things right at the start of a tenancy.

 

  1. Get to know your tenants

At Khalil’s we always try to strike up a good rapport with new tenants: it really helps if there are any issues that need resolving further down the line.

 

  1. Get a reference

We undertake employment checks, obtain references from their previous address and we investigate their credit history. We want good tenants for your property and checks are an essential way to ensure this.

 

  1. Get a commitment

A commitment is not just a one-off deposit and a month’s rent but a standing order to pay the rent every month. This is the real signal that you have truly rented your property.

 

  1. Get it written down

A property inventory is needed whether you are renting your property out furnished or unfurnished. It is essential to avoid disputes and ensure that any damage can be easily identified. Under the Tenancy Deposit Scheme, landlords who want to claim money from a tenant’s deposit must be able to prove the damage was caused under the tenancy. There is no doubt: you need an inventory.

 

  1. Get a gas certificate

Before any property is let, and every year after this, all gas appliances must be checked by a Gas Safe-registered plumber. You must give documentation of this check, and proof of any work carried out as a result, to your tenant (and each year thereafter).

 

  1. Get a fire safety check

Particularly if you are renting your property to three or more people (as an HMO) you should thoroughly assess any fire risks, fit smoke detectors and consider having a fire blanket and extinguisher in the kitchen.

 

  1. Get an Energy Performance Certificate (EPC)

By law you must get an EPC to show the energy efficiency and environmental impact of your property. This must be carried out by an accredited energy assessor. A copy of the EPC must be given to the tenant at the start of the tenancy.

 

  1. Get the deposit registered within 30 days

A deposit is required for all assured shorthold tenancies. You need to decide in advance which provider you will be using to comply with the Tenancy Deposit Scheme

Within 30 days of receiving the tenant’s deposit you must provide them with the details of the tenancy deposit scheme that has been used.

 

  1. Get a tenancy agreement

Landlords should ensure that tenants have signed a tenancy agreement prior to moving into the property. You cannot take a damage deposit without one and this agreement is crucial for providing the correct legal framework should you need it later.

 

Read more

Gas safe register: advice for landlords

RLA: 10 legal musts for landlords

Guardian: Landlords with EPC ratings F and G will be unable to let their property from 2018

Gov.uk: Tenancy Deposit Schemes

Lawpack: why you need a tenancy agreement

What is a Tenancy Deposit Scheme?

Since 2007 landlords setting up a new tenancy agreement have been required to place any deposit taken on their rental property with a Government authorised Tenancy Deposit Scheme.

Failure to do so can lead to a fine and leave you unable to use a Section 21 Notice to regain possession of your property.

You can read more about what happens if you do not use comply with the Tenancy Deposit legal requirements in our Landlord Advice article.

 

There are two types of Tenancy Deposit Schemes:

  • Insurance schemes
  • Custodial schemes

 

Insurance schemes

The tenant pays the deposit to you (or your agent). This deposit is retained by you and a fee is paid, on behalf of the tenant, to the registered scheme.

Khalil’s is registered with Tenancy Deposit Solutions, which is an insurance-based tenancy deposit protection scheme administered by a partnership between the National Landlords Association and Hamilton Fraser Insurance.

Within 14 days of receipt of the deposit you must register it with your chosen scheme, and inform your tenant about the scheme that is being used. A certificate confirming this will be sent by the scheme to yourself and your tenant.

At the end of your tenancy, once the amount of deposit to be paid back has been agreed upon, you must return this to your tenant. To do this you must advise your Tenancy Deposit Scheme that the deposit should be unprotected and refund the required amount no later than ten days after the tenancy has been terminated.

Should there be a dispute about the amount of deposit to be refunded you must hand over the disputed amount to the scheme for safekeeping until resolution is reached.

Disputes of this nature can be adjudicated through the Alternative Dispute Resolution service (ADR), which is a non-profit service providing you with a free alternative to going to court.

There are strict procedures that you must comply with to use this service. You must first provide notification of the dispute to the ADR and then lodge the disputed deposit amount (along with any evidence regarding this dispute) with your scheme within ten days of the date of this notification. Failure to comply with these procedures will result in disciplinary action being taken by the scheme.

 

Custodial scheme

The custodial scheme is administered by the Deposit Protection Service (DPS) and operates in a broadly similar way to insurance schemes except it does not allow you to retain the deposit yourself. Instead you must place the money for the damage deposit in the custody of the tenancy deposit scheme itself.

 

Exclusions to the scheme

The law regarding tenancy deposit protection schemes doesn’t apply where the tenancy is not an assured shorthold tenancy, such as for tenancies where the rent is over £100,000 per year or where the landlord lives in the same property as the tenant.

Read more

Tenancy Deposit Solutions: more information

DPS: more information

DPS: changes to Tenancy Deposit Protection

Lawpack: free download of a Section 213 Tenancy Deposit Protection Form

 

What are the tax implications of being a landlord?

Although there is nothing as certain in life as death and taxes the implications of death are much clearer to everyone than the implications of taxes.

We offer some useful links for you to explore below but advise you strongly to check with the Inland Revenue what the tax implications may be for you based on your personal circumstances.

If you are planning to move overseas you must contact your local revenue office, and they will provide you with useful advice regarding any tax implications.

If you move overseas and don’t register this with the Inland Revenue, you will find that your tax is instead deducted from your rental income at the usual rate, plus any agency administration fees that this will incur.

 

Read more

Gov.uk: Renting out a property

Gov.uk: Non-resident landlords

Which?: How rental income is taxed

Buy-to-let: Landlord’s guide to tax

Do I need to inform my mortgage provider that I am renting out my property?

You must let your mortgage provider know that someone other than you will be living in your property. This will need to be done in writing. Depending on how long you intend to let the property for it is possible that you may need to switch to a different mortgage.

Mortgage providers are increasingly intolerant of the failure of so-called ‘accidental landlords’ to inform them of changes to the use of their property. An ‘accidental landlord’ is someone who lets out their property due to a sudden change in their circumstances.

Recent reports in the news have suggested that mortgage providers are now actively looking for evidence that properties are being let. The Telegraph reports that “in a concerted drive to catch those abusing the system, lenders are trawling the electoral register, social media websites and online letting agencies for signs that a property has been put up for rent”.

What building and contents insurance do I need as a landlord?

It is essential that you review your building and contents insurance when you let your property. Failure to get the right insurance can prove very costly. Insurance aimed specifically at landlords is available and you can get a quote online for your insurance right here.

 

Do I need specialist landlord insurance cover?

You certainly do. Standard building and contents insurance are aimed at homeowners who live in their property and do not offer not cover for rental properties. Should something happen to your rental property you may find your cover to be void.

Let’s be clear: a standard household insurance does not cover you for buildings, contents or third party liabilities whilst your property is being let.

 

What is covered by landlord insurance?

The cover offered by landlord’s insurance is, in essence, very similar to standard household insurance. It is just offered at different terms due to the assessment of the risk that is being insured.

The majority of your premium is there to cover the cost of insuring the structure of the building itself. Cover also extends, in a typical landlord insurance policy, to the fixtures and fittings of the property (such as carpets, flooring, curtains, kitchens, bathrooms, electrical fittings and white goods). As such this is perfectly adequate for an unfurnished rental.

Always check to see if accidental damage of windows is included as this is often not the case for cheaper policies yet one of the most common areas of damage are the windows of your property.

 

Another thing to consider is theft. Whilst landlord insurance policies do cover theft this will usually only cover theft with ‘forcible or violent entry or exit’. This, by definition, does not cover you for theft by a tenant. Of course, having secured a deposit offers some protection against this.

 

If you are letting a furnished house or flat you may want to look into adding specific contents to your landlord insurance policy.

 

When considering policies you should always check the level of cover offered but, equally, you should check the level of excess that you must pay should you need to claim. If the excess is too high it effectively prevents you from making claims for smaller amounts, which can add up over time. An excess of around £100 is the norm for landlord insurance, but you must consider your own circumstances and needs.

 

Looking for landlord insurance quotes?

Look no further. Get yourself covered today.

How much rent should I charge?

This is one of the first questions we are always asked by landlords – and it’s a really sensible question.

Thankfully they are in the right place to ask it. We only deal with rental properties in and around Brighton so we are finely attuned to the gentle, and sometimes, seismic shifts in the market.

 

Of course the rent you charge depends on a number of factors including the property itself, its location, the sort of tenants you are looking for, the rental competition and how urgently you need the property to be rented.

If you try to charge too high a rent you run the very real risk of your property remaining empty. Similarly if you charge too low a rent it is very difficult to raise it until the current tenancy agreement needs renewing or the tenants decide to move out.

 

To understand what is too high or too low a rent you really need to understand the rental market very well. We can offer you a free valuation of your property and discuss the current market trends with you at any time.

 

Just give us a call on 01273 573960 or leave your details below and we’ll be happy to talk you through what you can rent your house or flat for.

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It is possible for you to do some scouting on your own so here are some tips on how to set a rent that suits the local renting market.

 

The first thing you need to do is to see what that market is. You need to find similar properties to your own. Look out for properties that are:

  • In the same location
  • Of the same size
  • Of the same type (furnished/unfurnished, flat/studio/house)
  • In the same condition

Places to check include:

  • Rightmove
  • Gumtree
  • Find A Property
  • PropertyFinder
  • Zoopla
  • Friday Ad
  • The Argus
  • Local property listings like Latest Homes
  • Student listing sites like Accommodation For Students

 

Now you have surveyed the market you can assess what is the right rent for your property. Always bear in mind and added extras you may offer or the properties you look at may offer such as a large garden, a double driveway, a garage or off-road parking, or white goods.

 

However, what none of this will give you is a flavour of the market.

That is something only someone who has worked with it day in and day out can accurately pass it on.

There are some areas where properties can take a higher price and easily find tenants. There are others where you would be better advised to lower your price slightly and take advantage of regular monthly rental income.

That’s what we’re here for – to help you rent your property at the most favourable terms.

Call us today on 01273 573960 for a free market valuation.

Do I need a rent book?

If rent is paid weekly, you have a legal obligation to provide the tenant with a rent book. Otherwise there is no requirement to use a rent book.

How can I raise the rent on my property?

Things change, especially in the world of rental property.

What seemed a fair rent a year ago may seem woefully low this year. But how can you raise the rent on your rental property and how often can you do it?

 

An annual adjustment to the rent is considered the norm and it is certainly the case that rent increases should be planned at least every couple of years.

 

Raise the rent through mutual consent

It is theoretically possible to raise the rent during the fixed term of a tenancy, but to do this requires the landlord and tenant mutually agreeing to do so. Understandably this is a tough ask: the tenant is under no obligation to agree to a rent rise. Should such an agreement take place, it’s important that you have their consent in writing.

 

Raise the rent using a Section 21 notice

Another more effective way to raise the rent is to serve a Section 21 notice to terminate the tenancy. This gives the tenant the option to agree to the rent rise under a new tenancy agreement or to leave the property when the fixed term comes to an end.

Of course, if handled with sensitivity and the rent rise is discussed prior to the brandishing of paperwork, this can be a perfectly amicable and mutually comfortable process.

 

Raise the rent using a Section 13 notice

If the initial fixed period has ended, and the landlord hasn’t served a Section 21 notice, but the tenant continues to rent the property then what is known as a ‘periodic tenancy’ has effectively begun.

In such a situation landlords can use a Section 13 notice to raise the rent. A Section 13 contains information about the rent increase and details the starting date for the rent increase.

The date for the rent increase must be at least 12 months after the date the tenant first moved into the property and also at least 12 months after the last rent increase.

This means that if the rent was not raised after an initial fixed term of six months it would not be possible to use a Section 13 until after the periodic tenancy has been running for six months.

 

How much notice is needed to increase the rent using a Section 13 notice?

In the case of weekly, fortnightly or monthly tenancies the notice needed to raise the rent must be more than one month from the date of service of the Section 13 and it must be given on the first day of a period of the tenancy (this is usually the day the rent is due).

It is always advisable, however, to give as much notice as possible.

 

What does a Section 13 notice do?

A Section 13 gives the tenant notice that you intend to raise the rent. They have until the date of the rent increase, which must be specified, to take action. If they decide to do nothing, then the rent will automatically increase on that day. If, however, they wish to challenge the rent increase, they can apply to the Rent Assessment Committee (RAC) and ask it to assess whether it is in line with current market conditions.

It is important to try to avoid all of this by timing your rent increases carefully and handling the process sensitively. You must ensure you follow the correct procedure or your rent increase will not be allowed and your tenant may even be able to recover any extra rent they have paid.

Should your tenant dispute the rent increase, and it is found to be a ‘fair’ increase, this could lead to them being evicted if they refuse to pay after the initial fixed period has ended.

 

Read more

Gov.uk: Rent Assessment Committee

Gov.uk: Rent increases

 

How to handle and avoid problems during a tenancy

In property rental, as in most things, prevention is far better than cure.

If you have scrupulously taken up references, and guarantor and credit checks before the tenancy commences, many problems can be avoided.

Similarly, if you follow the correct legal procedures, such as always using an assured shorthold tenancy agreement, you have the ability to act decisively should you need to.

 

The trouble is things can change quite fast.

The market changes, new requirements come into effect and your own goals may move: it can be hard to keep up. That’s why a letting agent can be your best point of contact: at Khalil’s we do all the running for you. You can relax, knowing your properties are being managed to minimise any risk to yourself. Should any problems arise, we are always in the best position to deal effectively with them.

 

Contact us on 01273 573960 to discuss any concerns you have about managing your properties, or leave your details and we will call you back at a time that’s convenient for you.

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Here are some of the ways that you can deal with problems that arise legally and effectively.

 

How to use a Section 8 notice

A Section 8 notice can be used by landlords to regain possession of a property that has been let under an assured shorthold tenancy and has fallen into rent arrears of more than two months.

You only have to give the tenant 14 days’ notice and it can be used at any point during a fixed or periodic tenancy. In practice it is often best to allow a bit longer because if the notice takes a bit longer to serve it may become invalid.

Prior to serving the notice you should try to resolve the rent arrears through using reminder notes and telephone calls. The Section 8 notice is your safety net not your first port of call.

Take care when drawing up a Section 8 notice.

All the tenants must be named in the notice and their names and addresses should match those recorded in the tenancy agreement. Even if a tenant has since moved out, they should still be named on the notice.

It is best practice to serve each tenant with a notice. A copy of the notice should also be sent to any guarantors, although they do not need to be named in the notice.

The notice should be served as specified in the tenancy agreement. This may be to give it to the tenant directly, to hand deliver it to the door or to mail it by first-class post.

Should the expiry date on the notice pass without resolution you can issue proceedings in court. This date is 14 days to the date of service of the notice (i.e. 14 days from its being delivered not written).

 

Read more

Gov.uk: Section 8 Notices

Landlord Zone: Section 8 Notices

 

How to use a Section 21 notice

Section 21 notices can be used to regain possession of a property that is let under an assured shorthold tenancy. The notice can only be used where the tenancy is for a fixed term and the tenancy is at an end.

You must give a tenant at least two months’ notice in writing.

Although you can serve a Section 21 notice at any time after the start of the tenancy, the notice cannot end before the fixed term has finished.

If the notice is served after the fixed term has ended, your two months’ notice must end on the last day of a ‘period of the tenancy’, which means the day before the rent is due to be paid.

It is important to complete the notice carefully.

All tenants must be named, and their names and addresses should match those in the tenancy agreement. Even if a tenant has moved out since signing the tenancy agreement, they should still be named on the notice.

It is best to serve each tenant with a notice individually and the notice should be served in one of the ways specified in the tenancy agreement.

You cannot use a Section 21 notice if the deposit for your property is not protected by one of the statutory tenancy deposit schemes.

(For more information about this see our article in our Landlord Advice blog).

The court procedure for Section 21 notices is ‘fast-tracked’ which means that, generally speaking, there is no need for a court hearing. This ‘accelerated procedure’ will normally take between eight and ten weeks.

Read more

Gov.uk: Section 21 Notice

Landlord Zone: A checklist for serving a valid Section 21 Notice

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