Accounts Navigator
It is undeniable that today, the UK is navigating a seller’s market. While house prices continue to rise and inventory is at an all-time low, renting your existing property or investing in a buy-to-let can be an excellent option to establish a robust passive income stream.
But how can you get started with letting out your property? Being the owner of a property does not automatically allow you to rent out your house or flat to a lender. And, doing so can put you on the wrong side of the law. However, there are simple steps that you can take to legally let out your property, take advantage of today’s seller’s market, and boost your finances.
Start with these 12 steps outlined by the experts at Accounts Navigator.
1. Obtain the Necessary Licences
The first step to legally rent out your property is to obtain the necessary licences for the type of rental you are looking to arrange. For example, if your property is a University-hosting city, you should opt to rent to multiple people not belonging to the same household.
In this case, you will need to obtain a house of multiple occupations (HMO) licence to guarantee that the house’s space and facilities are suitable for a certain number of people to share.
2. Comply With the Relevant Fire Safety Guidelines
Fire alarms, access to fire exits, and fire-resistant furnishings are just some of the fire safety guidelines that need to be met by rental properties. Work with your local authorities to understand specific requirements.
3. Obtain a Valid Energy Performance Certificate
For buy-to-let properties to be legal, they require a valid energy performance certificate. In 2022, the minimum EPC rating to rent a property is E but will be increased to C by 2025.
4. Get Your Gas System Certified for Safety
If your rental property uses a gas system, you will need to arrange regular inspections conducted by a Gas Safe registered engineer. Your tenants should be provided with a copy of the certificate.
5. Arrange Regular Electrical Safety Inspections
Rental properties should be inspected by a professional to ensure the electrical system’s safety and viability. Electrical appliances need to pass the yearly PAT test.
6. Market Your Property on Multiple Sites To Secure the Best Deals
Advertise your rental property on multiple reputable sites like Zoopla, Rightmove, and Facebook Marketplace to target your audience. Consider working with an agency to meet relevant requirements and make your property more appealing.
7. Carry Out a Background Check on Your Applicants
While keeping in mind the privacy of your applicants, you will need to make sure that prospective tenants have the right to rent in the UK.
8.Have a Tenancy Agreement Ready To Go
Work with an agency or hire an attorney to draft a tenancy agreement. If you are an experienced landlord, you might also draw up an agreement by yourself by using standard templates on the UK Government website.
9. Set and Collect a Deposit
If you have set a deposit for your property, make sure the conditions of your offer are clear. Use a government-sponsored tool and collect the sum from your prospective tenant while informing them of how and where the deposit is stored.
10. Prepare the Property
Get the property ready, inspect it, and take inventory of every item included. This will help you provide tangible evidence in case of stolen or damaged items.
11. Ensure Your Tenants Understand House Rules and Responsibilities
Provide your tenants with a rental guide that outlines their rules and responsibilities.
12. Protect Your Asset With a Landlord Insurance Policy
Protect your finances and your real estate investment with an optional Landlord Insurance Policy. Unsure how to get started with renting your real estate property? Get in touch with our team to make the process ahead as stress-free as possible!
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The world of Property is a difficult one to master, even more so in the current state of the world. Knowing what mistakes to avoid and what advice to follow can be challenging – so we have made it simple:
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