Q. I usually rent my investment property via an agent and have it fully managed by them too. My circumstances have changed now and I find myself with more time on my hands and am thinking of doing this myself, are there any pitfall’s I need to avoid?
A. There are plenty of Landlords that do choose to Let and manage their own properties, however you do need to be aware that there are many legal requirements of Landlords and it’s important for both your own and the tenant’s protection that this is strictly adhered to. Firstly you will need an EPC (energy performance certificate) prior to marketing, this is a legal requirement. Once a suitable tenant has been found I would strongly advise that you use a reputable company to reference the tenant, many Landlords do this themselves but its rarely as thorough as when the experts carry this out, remember you are entrusting a huge asset to a complete stranger Do make sure that you have a professional inventory carried out, this will be needed if there are any disputes when the tenant vacates the property, professional inventories are thorough and leave no room for doubt. Safety is paramount and as a Landlord you are responsible for ensuring that a Gas safety certificate is issued and renewed annually this must be in place prior to the tenant moving in. A portable appliance test is also highly recommended too, although this is not a legal requirement. Many landlords in the private sector receive a deposit against possible non-payment of rent or damage to property. When a tenancy comes to an end, there is usually no disagreement about the return of the deposit. But sometimes there is, and this can cause much hardship and inconvenience to both landlord and tenant. The Housing Act 2004 made provision for both the protection of tenancy deposits and the resolution of disputes over their return. The legislation came into effect on 6 April 2007. All deposits taken for Assured Shorthold Tenancies after that date must covered by a tenancy deposit protection scheme. Landlords or agents must use one of the three approved TDP schemes to protect tenants’ deposits where these conditions apply. If any other scheme is used, deposits are not protected in law. The three approved schemes are:
- Deposit Protection Service (DPS)
- My Deposits
- Tenancy Deposit Scheme (TDS)
If you don’t protect your tenants’ deposits when required to, your tenants can take you to court and you may have to repay them their deposit plus three times the amount of their deposit. You will also be unable to seek possession of your property in certain circumstances.
Finally if you are going to manage the property yourself, do carry out regular visits to the property to inspect the condition of the property, checking things like the sealant in the bathrooms is paramount especially if your property is an apartment, this could prevent leaks to the property below and further headaches with claims on insurance etc.