Six Tips for Renting Out Your Home

Whether you’re new to the process or a seasoned landlord, renting out your home can seem like an overwhelming and daunting experience. However, below are six tips that will help you avoid the perils of renting and assure the entire process goes as seamlessly as possible.

Doing your research

1)      Research

Doing your research before renting out your property is crucial. Begin by looking at the different properties being rented out in your locality and how much for. It is also important to note that you will pay tax on the money you’ll earn from renting, so make sure you do your calculations. You should also consider what demographic you wish to target. Is your property suitable for families, students or professionals?

1)      Employ a Good Agent

Although managing a property yourself will save on additional costs, many landlords chose to use a letting agent. Do your homework on those in the locality in relation to the services they provide and their fees. Amongst the variety of fees associated with using a letting agent, landlords will be charged both a 7-10% finder’s fee and a 6-10% management fee.

2)      Prepare Your Property

Preparing your property to rent

Prior to renting our your property, do all necessary maintenance work, such as decorating, having the boiler serviced and checking the appliances and electrics are in working order. Landlords also need to decide whether they wish to rent out their property furnished or unfurnished. If you are furnishing the property, you can monitor your inventory with property inventory software like that found at https://inventorybase.co.uk/.

3)      Do Your Homework on Potential Tenants

It would be advisable to meet prospective tenants prior to renting your property to them. You, or your letting agency, can request credit checks and references to ascertain whether a person is reliable and fit to be a tenant.

Legal requirements and deposits

4)      Legal Requirements

Landlords are required to abide by a plethora of regulations – around 150 laws to be exact. Even though it is not required by law, it would be beneficial to have a written tenancy agreement so that you and your tenant understand your responsibilities and rights. Click here for more information on the legal requirements of a landlord.

5)      Deposit Scheme

Most landlords require tenants to pay a deposit (usually 4-6 weeks’ rent). This must be registered with the Deposit Protection Service, either online or via your letting agent.

Mistakes landlords commonly make

Some of the most costly landlord mistakes come from skipping the basics. Choose a property with good rental potential, sound condition, good transport links and amenities such as shops, schools and hospitals nearby. Vet tenants carefully, asking for references from previous landlords, proof of income, bank statements and a credit check. None of these guarantee rent will be paid, but they show the funds exist.

Protect the deposit properly. It must be registered with a government-approved scheme within 30 days, and failing to do so can lead to an order to pay up to three times the deposit. Let tenants know once it is registered. Prepare a detailed inventory of every room, noting the condition of each item, including scratches, dents and stains, with photographs if possible, to avoid disputes later.

Standard home insurance does not fully cover a rented property, so take out specialist landlord insurance, and consider rent and legal protection too. Finally, check the property regularly, always arranging visits at a time that suits the tenants. If you live far away, a managing agent can handle tenants, finances and maintenance for you.

Summary

This article gives six tips for renting out a home, starting with researching local rental prices, tax implications and your ideal tenant before deciding whether to use a letting agent. It also covers preparing the property with necessary maintenance, vetting tenants with credit checks and references, understanding legal requirements, and registering a tenant’s deposit with a protection scheme.

Questions this article raises

• How much do letting agent fees typically add up to overall?
• What happens if a landlord doesn’t register a tenant’s deposit correctly?
• How many of the roughly 150 landlord laws actually apply to a typical rental?