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Self-managing a property saves landlords money, but it’s not for everyone. There is a lot to think about and the penalties for forgetting crucial parts of the process can be steep. As with many things in life, being organised is essential. To help you get started, here is a checklist of must-do tasks.
Is the Property Fit for Tenants?
Before landlords install tenants in a rental property, they must ensure it is safe. The Homes (Fit for Human Habitation) Act received Royal Assent in 2018. Section 10(1) states:
“In determining … whether a house or dwelling is unfit for human habitation, regard shall be had to its condition in respect of the following matters—
- repair,
- stability,
- freedom from damp,
- internal arrangement,
- natural lighting,
- ventilation,
- water supply,
- drainage and sanitary conveniences,
- facilities for preparation and cooking of food
- and for the disposal of waste water;
- in relation to a dwelling in England, any prescribed hazard;
and the house or dwelling shall be regarded as unfit for human habitation if, and only if, it is so far defective in one or more of those matters that it is not reasonably suitable for occupation in that condition.”
Rental properties with severe issues, such as damp, mould, inadequate heating, pest infestations, etc. fall foul of the act. As soon as a landlord is made aware of problems by a third-party, they must take steps to fix them. For obvious reasons, it’s better to fix issues before a tenant moves in than be put on notice and liable after the event.
Making sure a property is safe is not rocket science. For the most part, it’s common sense. Take a good look around your rental property. Would you live in it? If not, why not? Perhaps you dislike sharing your breakfast with mice or the black mould in the shower cubicle is a bit off-putting. Are the windows drafty? Does the front door stick when it’s damp?
Fix any issues that could conceivably be construed as a safety problem.
- Pay attention to fire safety – fit smoke alarms and CO detectors.
- Have the electrics checked to ensure there are no hidden dangers lurking in the circuitry. As of July 2020, all private rental homes must have had an Electrical Condition Safety Report (EICR) carried out by a registered electrician, to ensure all electrical installations are safe. A copy of this report should be given to the tenants.
- If there are gas appliances in the property, you must give your tenants a Gas Safety certificate; more on this below.
HMOs are subject to stricter safety requirements, and if you’re applying for a landlord licence, you will need to show you have ticked all the boxes. Find out more about HMO rules here.
If you wouldn’t want to spend a night in your property, it’s likely nobody else will be thrilled about doing so either. A well-maintained property is much easier to let and can command a higher rent.
A Lick of Paint
Once you have addressed any safety and maintenance issues, it’s sensible to spruce the place up before you begin marketing it. Give the walls a lick of paint to freshen them up. Most landlords prefer to use neutral colours, as these appeal to the majority of tenants.
Marketing the Property
Finding suitable tenants is an important part of the self-management process. Some opt for a tenant finder package from a letting agent, but marketing rental properties isn’t all that difficult. With the aid of digital channels and some time, you should have no problem finding people interested in your rental property. Make sure your rent is competitive, as people won’t want to pay over the odds unless you are offering something amazing in return. Make sure you are targeting the right demographic.
The first step in property marketing is to prepare your marketing materials. Good photos ‘sell’ a property. If your photography skills are lacking, hire a professional to take the photos. Letting agents use freelance photographers so there’s no reason why you can’t do the same. Choose a nice sunny day for your photo shoot, so the property is well lit inside and out. Photos are best taken shortly after a property has been decorated and floor coverings replaced, so everything looks clean and tidy. Don’t forget you can reuse the same photos each time you need to market the property, (as long as there aren’t significant changes) which makes professional shots a good investment.
Property Portals
There are many ways to market a property but if your budget is limited, stick to the main property portals. The top five are:
- Rightmove
- Zoopla
- Airbnb
- PrimeLocation
- OnTheMarket
The downside is that landlords can’t add listings directly. Sign up with an online letting agent so you can create a listing on big sites like Rightmove and Zoopla. Sites like OpenRent offer free trials, followed by a monthly subscription.
Don’t forget about buy/sell sites like Gumtree – plenty of people use these sites to find somewhere to live. The quality of the leads will be lower, and it’s mostly good for finding low rent tenants, but since it’s free, why not give it a try?
Other sites worth trying are Loot, Craig’s List, SpareRoom, and House Ladder.
Social Media
Social media is also a valuable marketing tool. Many younger tenants spend a lot of time on Facebook, Twitter, and other social media channels. It’s definitely worth having a strong presence on there if you want to attract tenants.
Create a Facebook page for your property rental business. List your rentals on local Facebook groups, but be careful not to spam users. Add links to your listings from your social media feeds and encourage users to share links with friends and family.
Local Adverts
Local ads can be effective if you’re targeting older tenants who might not use social media or the internet. Try placing cards in shop windows or on supermarket message boards. Another trick worth trying is to place a sign outside the property with your telephone number, so anyone walking past can get in touch.
Word of Mouth
Don’t underestimate the power of word of mouth advertising. Tell everyone you know about the property and ask them to spread the word. Encourage existing tenants to tell their family, friends, acquaintances, fellow students, etc. you have a property to rent. It’s worth offering a referral fee to sweeten the deal.
Tenant Referencing
Tenant referencing is critical. Do not assume that because the tenant is polite and driving a nice car, that they must have plenty of money and be respectable. It doesn’t work like that. Seemingly respectable people sometimes do front criminal enterprises. In short, tenant referencing mitigates some of the risks of being a landlord – e.g. letting to unreliable tenants.
Appearances can be very deceptive and the only way to make sure a prospective tenant is squeaky clean and not bogged down with debt is to carry out tenant referencing.
Tenant referencing checks a tenant’s basic personal information, such as their name, address, employment details, and financial history. It should help you spot when someone is lying about something important, like their name, personal finances, or job.
There are some parts of the tenant referencing process you can do yourself, such as contacting a former landlord or calling their employer. You can also check out the person on social media. It’s hair-raising just how much information people post online, without giving it a second thought.
Ask a prospective tenant to fill in a questionnaire before you do anything. You can use the information they give you to check them out. Ask to see wage slips or an SA302 if they are self-employed and check bank statements.
Tenant checking services will dig deeper beyond the superficial. They’ll look for CCJs, linked addresses, and verify a previous landlord’s references. It’s worth paying for such a service if you want peace of mind. OpenRent and the NRLA both offer a cost-effective tenant check for landlords.
Right to Rent
Landlords must check a tenant’s immigration status. Since 2014, only people with permission to live in the UK are allowed to rent a property. Ask to see a tenant’s passport or ID card as part of the tenant referencing process. If you’re not sure or the tenant can’t provide suitable documentation, request a Home Office Right to Rent check.
If you fail to carry out a Right to rent check, you risk being fined up to £3,000.
Tenancy Admin
Once you have found a suitable tenant, there’s more admin to do!
EPC Certificates
As of April 2020, all rental properties must meet minimum energy performance ratings. Any property rated F or below can’t be let to tenants.
All properties must now have an Energy Performance Certificate (EPC) before being marketing for rent. If you used a letting agent to market your property, you’ll probably already have one of these, but if you did your own marketing via social media, you might not.
Landlords must give a copy of the property’s EPC to a tenant when they move in. If you don’t, it has repercussions in the event you need to evict the tenant at a later date – a copy of the EPC must be served prior to a Section 21 notice.
There are penalties for not making an EPC available to a tenant. In most cases, this is calculated at 12.5% of the rateable value of the building. If the formula can’t be used, the penalty is fixed at £750.
EPCs can be sent via email, but only if the tenant gives you permission to contact them electronically.
Tenancy Agreements
A tenancy agreement is a contract between you, the landlord, and the tenant. It outlines all pertinent information related to the tenancy, such as how much rent is due, how much notice the tenant must give if they want to leave, etc.
Most landlords use an Assured Shorthold Tenancy agreement. You can find template AST forms online here. Boilerplate tenancy agreements can be used without amendments or additions, but they can also be adjusted to suit the tenancy, with extra clauses added if necessary. Always double-check the tenancy agreement you use is suitable for your needs.
You will need two copies of the contact – give one to the tenant and keep one for your own records. It’s good practice to go through the tenancy agreement with the tenant, to make sure they understand their responsibilities before signing on the dotted line. This is especially important if you add any new clauses.
How to Rent Guide
Landlords must give their tenants a copy of the government’s How to Rent Guide within 21 days of the start of the tenancy. You can find it here. Always make sure you give your tenants the latest version, as it’s updated regularly.
Gas Safety Certificate
If the property has any gas appliances – e.g. a gas boiler or gas fire – tenants must be provided with a Gas Safety Certificate (CP12) at the start of a tenancy. Gas safety checks should be carried out annually by an accredited Gas Safe engineer. In short-term lets, a copy of the Gas Safety certificate should be displayed in a prominent location in the property.
Do not allow a Gas Safety certificate to lapse – it is a criminal offence with a £6,000 fine per item and/or six months in prison.
Deposit Protection
A tenant’s deposit must be placed in a government-approved deposit protection scheme. There are currently three available:
- MyDeposits
- Deposit Protection Service
- Tenancy Deposit Scheme
Once the tenant has given you their deposit, you have 30 days to place the money in one of the three schemes listed above. The government website says landlords must give the tenant the following information:
- The address of the rented property
- The deposit amount
- How the deposit is protected
- The name and contact details of the tenancy deposit protection (TDP) scheme and its dispute resolution service
- The landlord’s (or the letting agency’s) name and contact details
- The name and contact details of any third party that’s paid the deposit
- Why the landlord would keep some or all of the deposit
- How to apply to get the deposit back
- What to do if the tenant can’t get hold of the landlord at the end of the tenancy
- What to do if there’s a dispute over the deposit
If you don’t protect your tenant’s deposit, the court can order you to repay 3x the value of the deposit to the tenant within 14 days. You might also be unable to evict the tenant.
Landlord Insurance
Landlord insurance isn’t compulsory, but it is recommended. Landlord insurance will provide some measure of protection against property damage and rent arrears. Remember, there are many things that can go wrong, and even a relatively small water leak can cause significant damage. If you have a buy-to-let mortgage on the property, it’s likely that buildings insurance is a condition of lending.
Shop around for landlord insurance. Don’t assume the cheapest policy is the best one. Look at the cover provided and make sure it fits your needs. Read reviews to check how good the provider’s customer service is – cheap insurance is useless if the insurance provider is difficult to contact and goes the extra mile to avoid paying out on a claim.
Property Inventory
A property inventory is a record of the condition of the property at the start of the tenancy. If you can prove what state the property was in prior to the tenant moving in, you stand a much better chance of winning a dispute if they cause damage.
Landlords can do their own property inventory checks. Record as much detail as possible – the more the better. Photos and videos are very useful in this regard but take notes too.
Go over the property inventory with your tenant prior to them moving in. Ask them to sign the inventory report to show they agree with it.
Furnished or Unfurnished?
Decide whether you want to let your property furnished or unfurnished.
Long-term lets are usually let unfurnished, but HMOs and short-term rentals, for example, holiday lets, are typically let furnished.
If the property was previously your family home, remove all personal items and anything you value. Rental properties are subject to more wear and tear than average, so unless you are marketing a high-end rental property, it’s better to install less valuable items.
Make a note of the condition of each item on your inventory.
Final Checks
Take meter readings before a tenant moves in. This will prevent issues with the energy company if the property has been empty for a while.
Rental properties should be cleaned before a new tenant moves in. You can do this yourself, but some landlords prefer to hire contract cleaners. Given the current pandemic, and the need for deep cleaning between tenants, paying professionals to do a more thorough job is probably a good idea.
There is a lot to think about when managing your own property rental business. Not surprisingly, it’s easy for some tasks to slip through the net. However, landlords are bound by legislation and memory lapses are not a defence if you end up in court. Being organised is the best way to ensure you don’t forget to carry out a crucial task. This is where landlord software comes in really handy. If you are new to the world of rental property self-management, why not give it a try?
Do you self-manage your buy to let portfolio? Tell us more about your experiences. You can contact us on Twitter or Facebook. We’re always happy to hear from our fellow landlords!
