Property valuation Landlords Guide The best place to start the letting process is when we visit you at your property. This meeting is called a market appraisal and we use it to assess your requirements, establish who your property is likely to appeal to, agree how much rent we think you should be able to achieve and suggest any recommended improvements to help ensure you maximise the potential of your property. We base our valuations on actual properties recently let within your local area. We also take into account a number of other factors such as market conditions, the location of your property, the size of your accommodation and, if furnished, the standard of that furnishing. Preparing your property Target market It is worth thinking about the kind of tenant you want to attract as each type of person has different needs. For example, young professionals tend to want contemporary decoration, while students will require desks and young families generally like to eat in kitchens with a table. Presentation Properties that look good achieve higher rents and let more quickly. So it really is worth taking time to ensure your property is presented to the highest possible standard. As a general guide, the following ideas work well when letting a property: Before marketing your property, ensure that it is in good decorative order and sound structural condition. If you re living in the property while it is being marketed, do make sure that you keep it clean and banish clutter. Keep the decorations neutral the property will look cleaner and is more likely to fit in with your tenants personal belongings. Gardens should be left neat, tidy and rubbish free, with any lawns cut. If your property is let furnished, include everyday items like a vacuum cleaner, ironing board and, if there is a garden, a lawn mower. If your property is unfurnished, you will still need to supply carpets, curtains, light fittings and a cooker. Every property is individual, but we have a great deal of lettings experience and are always happy to help you maximise the potential of your rental property. Finding the right tenant Marketing your property The key to letting your property quickly is to ensure it gets maximum exposure to the right people. To achieve this, we can use a range of marketing methods, including:
Websites our properties are on the major property portals as well as our own high-profile website. We can advertise in the local press and other relevant publications. Our To Let boards are prominent and distinctive. We have a large client bank of tenants ready to move into rented homes. Viewings You can choose whether you would like us to accompany your viewings or if you would like to do them by yourself. If you want us to accompany the viewings, for which there will be a charge, they will be carried out by our fully-trained staff that are able to spot essential buying signals and take the lettings process forward. We try to be as flexible as possible by offering peak viewing times such as lunchtimes, evenings and weekends. Signing up your tenant Once we have found a tenant that you are happy with, we will request a completed Tenancy Application form and a reference fee. As soon as these are received, we will progress to taking up the references. Tenant references Referencing is our main way of assessing a potential tenant. It s so important that we use an independent referencing company experienced in this field. Once we receive a Tenancy Application, the referencing company will arrange a formal credit check and further checks with your applicant s employer and any previous landlord. These checks are accessed and communicated to you for approval before the tenancy is agreed. Our services s Full management If you don t live near your property, or don t have the time to deal with issues such as finding suitable tenants, collecting rent and arranging contractors, this service is for you. Under this full management letting service we will take care of everything you can just sit back and enjoy the income your property generates. During the tenancy we carry out periodic inspection visits. Should these bring to light any maintenance issues, we will (within the confines of our Management Agreement) and after consultation with a landlord, arrange or recommend any necessary repairs. Collecting and processing of rental payments is also an important part of our Full Management Service. Rental balances will be credited automatically to the Landlord s nominated bank account. Towards the end of the tenancy, we will liaise with the Tenant, with a view to renewing the tenancy agreement, or re-advertising the property to let and arrange to check them out.
Let only This service is only taken up by a small proportion of landlords, ideal if you re a very experienced landlord but don t want to go to the trouble of finding a tenant and setting up the tenancy. Our research has shown that tenants who pay rent direct to landlords are more likely to be late with their rent or not pay at all. This is because tenants recognise that as an organisation we have the man power, legal backing and knowledge to pursue rents through every means necessary. If you choose Let Only we will get your property let and your tenancy up and running and then hand it over to you. You will then be responsible for rent collection. Managing and ending the tenancy Most properties are let on Assured Shorthold Tenancies for 6 or 12 months. You cannot regain possession of your property before the end of the term of a tenancy unless the tenancy has been breached, or your tenant agrees to an earlier repossession. Even at the end of the tenancy there are certain regulations you need to follow. For example, you need to give a minimum of two rental periods notice in writing if you want your tenants to vacate the property on the final date of the contract. We are very proactive in managing all the properties on our books and will write to you and your tenants whenever necessary to ensure you don t miss important dates such the gas safety check. Landlord tax guide While an income from property letting is always welcome, there are some tax implications that you need to be aware of. Here s a quick guide to your tax liability as a landlord. We explain how you can offset costs and expenses associated with the general running and maintenance of the property you rent out. UK Resident Landlords If you are a landlord who lives in the UK, any profit you make from renting your property will be subject to Income Tax. When we collect the rent on your behalf, we don t deduct any tax from the rent we pay you, so you will need to inform the Inland Revenue of this income yourself. There are a number of expenses that can be offset against rental income and we would therefore recommend that you contact an accountant or suitably qualified professional to find out more. Non UK Resident Landlords If you are treated as a non-resident landlord for UK tax purposes, you will still have to pay UK income tax on any profits you receive from renting your property. In these circumstances, we are obliged by law to deduct basic rate tax from any rent we collect and send it to the Inland Revenue on a quarterly basis. To qualify for an Exemption Certificate, the Inland Revenue usually requires that: Your UK tax affairs are up to date, or You never had any UK tax obligations, or You do not expect to be liable to UK income tax
If your property is in joint names we will need one certificate for each of the joint owners and we will need to receive the Exemption Certificate(s) before we can pay your rental income gross. How to reduce your tax liability The Inland Revenue views landlords in the same way as businesses, which means that any costs associated with running and maintaining the property that you incur may be offset against the rental income. This can substantially reduce or even eliminate your tax liability. Typical costs and expenses include: Loan interest (but not capital repayments). Rent, ground rent, rates and water rates. Professional fees: letting agents, accountants, legal fees, etc. Any costs of providing services included in the rent, for example, gardening. Costs of property repairs and maintenance. For furnished properties a wear and tear allowance of 10% of the annual rental income. Buildings and contents insurance. Make sure you keep all receipts and invoices. If you make a loss on the rental property, you can carry this loss forward to offset against profits from the property in future years. For more information on tax please go to www.hmrc.gov.uk or speak to an accountant or suitably qualified professional to find out more. Health and Safety, and other Legal Requirements All landlords of properties in the UK must comply with a number of strict safety regulations designed to protect their tenants from avoidable hazards. These safety regulations have been revised over the years, and penalties for non-compliance can be very severe. It is important to acknowledge that legislation can change significantly. Where we are managing the property they are also our responsibility. Therefore where we are managing we will ensure compliance, any costs of which will be the responsibility of the landlord. Gas Under the Gas Safety Installation and Use Regulations 1998 there is a legal requirement that all gas appliances, pipework and meters are checked and certified every year by a Gas Safe Register engineer. A record of this must be kept and a copy provided to the tenant within 14 days. Compliance is vital as deaths are caused each year by the use of faulty appliances and, where no inspection has been carried out, landlords are considered responsible. Oil and Solid Fuel Although there is no specific legislation applying to oil and solid fuel, we recommend that appliances are serviced regularly to ensure their safety.
Electricity As a landlord you have a legal duty to ensure all electrical appliances are safe. Obtaining an Electrical Equipment Safety Certificate (EESC) is not currently a legal requirement, but it is now widely accepted in the letting industry that it is the only safe way to ensure safety. You will be legally liable if your tenant suffers injury or is put at risk because of faulty electrical goods or wiring so to avoid the risk of being accused of neglecting your 'duty of care' we recommend that all landlords obtain such certificates. Notwithstanding the above, Portable Appliance Testing is required by law. The definition of a portable appliance, according to The National Association of Professional Inspectors and Testers (NAPIT) is 'any electrical item which can or is intended, to be moved whilst connected to an electrical supply.' The Institute of Electrical Engineers Code of Practice provides further guidance on the various types of equipment: 1)Portable appliance: An appliance of less than 18kg in mass that is intended to be moved whilst in operation or an appliance which can easily be moved from one place to another, e.g. vacuum cleaner, toaster, food mixer, etc. 2)Transportable or movable equipment: This equipment is either: a weight of 18 kg or less and not fixed, e.g. electric heater; or Equipment with castors, wheels or other means to facilitate movement by the operator as required to perform its intended use, e.g. portable air conditioning unit 3)Hand held appliances or equipment: Defined as portable equipment intended to be hand held during normal use, e.g. hair dryer 4)Stationary appliances ances or equipment: This is defined as equipment with a weight exceeding 18kg and not provided with a carrying handle, e.g. Washing machine, refrigerator 5)Fixed appliances or equipment: This is defined as equipment or an appliance which is fixed to a support or otherwise secured in a specific location, e.g. bathroom heater 6) Equipment or appliances for building in: This is defined as equipment which is intended to be installed in a prepared aperture or recess such as a cupboard or similar. In general, equipment or appliances designed for building in, does not have exposure on all sides because one or more of the sides are covered or built in, which provides additional protection against electrical shock. e.g. built in electric cooker 7)Information technology (IT) equipment: IT equipment includes electrical business equipment such as mains powered telecommunications equipment, computers, and other equipment for general business use, such as monitors and photo-copiers etc. Furniture and fittings The Furniture and Furnishings (Fire Safety) Regulations 1988, plus amendments, makes it a criminal offence to let a property with upholstered items that do not comply with the safety regulations.
The regulations apply to beds, mattresses, sofas, cushions and other soft furniture. These must all carry a label showing fire resistance. Any non-compliant furniture or those that do not have evidence of being compliant must be removed from the property prior to the tenancy commencing. Smoke alarms The Building Regulations 1991 insist that mains-operated smoke alarms must be fitted in all new buildings. Property built before 1992 need not comply. However, we recommend that as a minimum a battery-operated smoke alarm be fitted to every floor of a rented property, to better protect tenants and your investment. Structure and exterior Section 11 of the Landlord and Tenant Act 1985, states that landlords must keep in repair the structure and exterior of the property including drains, gutters and external pipes. Landlords are obliged to keep in repair and proper working order the installations in the property for the supply of water, gas and electricity and for sanitation. You are required to keep installations in the property in repair and proper working order for the heating and hot water supply. Energy Performance Certificates (EPC) As of the 1st October 2008 all properties being marketed as available to let are required to have an Energy Performance Assessment carried out and a certificate produced. An EPC is a report prepared by a Domestic Energy Assessor (or DEA) on the energy efficiency / carbon footprint of a particular property, not to be confused with reports on safety of electrical or gas installations. As well as providing information on the current energy efficiency of a property, it also provides an idea of to what level and how it could be improved upon. Administration Tenancy Deposit Protection As of the 6th April 2007, all Tenancy Deposits must be protected in accordance with the rules and regulations of the Tenancy Deposit Protection Scheme implemented under the Housing Act 2004 and apply to all Assured Shorthold Tenancies. Schedule of Condition/Inventory It is most important that an inventory of contents and a detailed schedule of condition including photographs is prepared, in order to avoid a misunderstanding or dispute at the end of a tenancy. It is not mandatory to have a schedule of condition and inventory of contents yet without such safeguards, it will be impossible for the Landlord to prove any loss, damage, or significant deterioration of the property or contents. All the approved tenancy deposit schemes have made it clear that without proof of a claim in a dispute, any decision is likely to be in favour of the tenant rather than the landlord,
Mortgage If your property is mortgaged, you should obtain your mortgagee s written consent to the letting. They may require additional clauses in the tenancy agreement of which you must inform us. Insurance You should ensure that you are suitably covered for letting under for both buildings and contents insurance. Failure to notify your insurance company may invalidate your policies. Leaseholds If you are a leaseholder, you should check the terms of your lease, and obtain any necessary written consent before letting. Bills and regular outgoings We recommend that you arrange for regular outgoings e.g. service charges, maintenance contracts etc. to be paid by standing order or direct debit. However where we are managing the property, by prior agreement, we may make payment of bills on your behalf, provided such bills are received in your name at our office, and that sufficient funds are held to your credit. Council tax and utility accounts The tenant is responsible for all charges for electricity, gas or oil (where applicable), water and council tax for the duration of their tenancy. They must also pay for any telephone and internet connections, satellite/cable services, and a television licence where applicable. A landlord is not expected to provide internet, satellite or cable facilities within a property, although provision of a standard telephone line is strongly recommended. It is the tenant s responsibility to find out if these services are available prior to renting a property. For properties managed by GSC Grays, meter readings will be taken and we will arrange for the transfer of Council Tax and utility accounts to the Tenants name. Telecommunication companies will require instructions directly from both the Landlord and the Tenant. Any utility charges between tenancies remain the landlord s responsibility.