If you’re a new landlord, it can be easy to get overwhelmed by the enormity of the situation. What, at face value, seems to be a relatively straightforward transaction between two parties - you and your tenant - quickly morphs into a mammoth to-do list full to the brim with essential tasks.
Without a proper plan in place, things can quickly get out of hand. Wouldn’t it be amazing to have a landlord checklist to hand? We thought so, too!
Before we go through the landlord checklist
Before we dive into all the things you need to do if you want a smooth and successful tenancy, there is a critical point we need to clarify first. Many new landlords, be they accidental landlords or first-time investors, are unaware of the fact that they need either a specific buy-to-let mortgage or an agreement with their lender in place before they let.
There are key differences between buy-to-let mortgages and those used by homeowners, and having the wrong one in place could land you with, at best, increased rates and extra charges. On the other end of the spectrum, you may be deemed as willfully violating your agreement and asked to pay your remaining mortgage balance immediately, which is obviously far from ideal!
Oh, and because you have contravened the agreement between you and your lender, your credit rating will also be affected, so getting another mortgage elsewhere may prove to be all but impossible. Basically, what we’re saying here is this: either get a designated buy-to-let mortgage or obtain a Consent To Let agreement for a short-term fix at the very least.
With that out of the way, let’s get on with the job at hand, shall we?
The tenants
The first part of the landlord checklist is all about the most important people to your business: your tenants. This is a time consuming part of the process, but the effort you put in now has the potential to pay you back handsomely as the tenancy progresses.
Here’s what you need to do:
Tenant referencing
Tenant referencing gives landlords an opportunity to look closely at those who wish to rent their property, giving them a more detailed view of who they are and what they might be like as tenants. Of course, this is by no means a fail-safe procedure, but it will give you an insight into your new tenants that you wouldn’t otherwise have.
Things checked during tenant referencing can include the following:
- Proof of identity
- Financial status
- Employment status
- Credit history
- Previous addresses
- Right to Rent (see below)
- Guarantor information (if applicable)
- Previous landlord references (if applicable)
As you can probably gather by the list above, this type of background check is essential, even though it is not a legal requirement. Additionally, you are not restricted to the above checkpoints and can ask further questions if they are pertinent to the tenancy, such as ‘do you have pets?’ or ‘will you have family members or friends staying frequently?’.
While running tenant referencing is a vital part of the process, many landlords hate doing it. As one would expect, then, there are referencing companies out there who will handle this for you or you can ask your letting agent to conduct the referencing on your behalf as part of their property management service.
Right-to-Rent checks
Conducting Right-to-Rent checks has been a legal requirement for some time now and ignoring it could land you with a hefty £3,000 fine for every illegal tenant that slips through the net. These can be quite in depth, so you might want to check out our full guide to right-to-rent to ensure you avoid any unnecessary penalties.
Tenancy agreement
Despite being an official document, you are not required by law to draw up a tenancy agreement. However, very few landlords choose not to, as having a solid tenancy agreement in place is crucial, especially if the worst happens and you end up in a dispute with your tenant.
A good tenancy agreement will cover everything from the type of tenancy (usually an Assured Shorthold Tenancy (AST)) and how much rent the tenant will pay, through to who has responsibility for what and the notice period required to bring the tenancy to an end.
As you may need to produce the tenancy agreement in court if things go awry, it’s always a good idea to seek legal advice when drawing a new one up.
The property
The next part of our landlord’s checklist is all about the property itself. Ask yourself the following question:
Structurally sound?
Easy one this, but essential nonetheless: Is the property you intend to rent out structurally sound and in a good state of repair? Anything that requires attention should receive it. Remember that small jobs addressed early will prevent big problems further down the line.
Clean and tidy?
Ensure everything is clean and tidy before a tenancy commences. This is not only the right thing to do for your prospective tenants, it’ll also stand you in good stead in terms of your inventory and marketing photos.
Free from damp?
As a landlord, you have a duty of care to your tenants, so take the time to check for any signs of damp starting before you let your property out.
To ensure your rental remains in good condition throughout the duration of the tenancy, make sure your tenants are fully aware of how to stop condensation causing problems for you and them while they are living in your property.
Furnished or unfurnished?
Simple question, complicated answer: Should your property be furnished or unfurnished? Check out the article behind the link for our take on this landlord dilemma.
Does everything work?
And, yes, we mean everything! Check every window, light fixture, electrical appliance, radiator, telephone socket...the lot. Rest assured, if it doesn’t work, your tenant will want it fixed anyway (and rightly so), so it’s far better to start the tenancy with everything in good working order.
The financial side
Let’s move onto the thing that everybody loves to hate talking about: Money.
Who pays what?
Do you know what you want your tenants to pay and what you’re happy to foot as the landlord? Will you include utilities in your rental charge? What about Council Tax?
It’s entirely up to you what you include and what you don’t, but you obviously need to be clear about it. Now’s the time to do just that.
What are you going to charge for rent?
Have you had a rental valuation conducted on your property? Do you know what you’ll need to charge in order to make letting the property financially viable?
What deposit do you need?
The rules over what you can ask for in terms of a deposit have changed a lot over recent years, but you’ll still need to be exact about your requirements. Most landlords will now simply opt for the full five weeks, but it’s up to you.
You should, however, really have a minimum of a month’s rent as a buffer against tenants leaving without making their final payment.
Will you require tenants to have a guarantor?
Some landlords do, some don’t. Again, this is a decision for you to make.
Not sure? Check out this post: What Is A Rent Guarantor?
How are you going to track payments?
Way back when, keeping rent books was your only option, but in today’s world of spreadsheets and apps, things are altogether different. If you’re going to be self-managing your rental, you need to get this straight if you want to avoid missed payment problems at a later date.
Will you take out landlord insurance?
Yet another case of ‘ you are not legally required to, but you should’. Landlord insurance can offer a nice safety net for those unforeseen moments.
You will, however, need specific landlord insurance and not simply a standard home insurance policy, as this will not provide you with the necessary cover.
The management
As letting agents, we’d strongly recommend leaving the job of property management to the professionals. That said, if you have the time, patience, legal know-how, and willingness to deal with tenants, there are a few management points to add to our pre-tenancy checklist:
Who is going to conduct your inventory?
You can carry out an inventory yourself, have your letting agent do it, or bring in a third-party inventory provider. It’s entirely up to you how you do your inventory, but you definitely should have one done. Check out our post on why tenancy inventories are so important to find out why.
Have you got a visual record of the property in its current state?
If you ask an inventory provider to perform your inventory for you, some will include photographs alongside their report, but not all. Regardless of whether or not they do, having your own images will certainly do no harm, so take as many as you deem fit and store them safely.
Are you safely storing all documentation?
Failing to safely store documents relevant to the tenancy could come back to bite you if things go wrong. You should be keeping track of everything, including correspondence between you and the tenant, payment details, work carried out on the property, and anything else connected to the tenancy.
If in doubt, save it.
The legal stuff
The final section of our new landlord checklist is arguably the most important, as it’ll help keep you on the right side of the law. It’s also the area that landlords find the most difficult to keep on top of, thanks largely to its ever-changing nature.
Has the property got an up-to-date Energy Performance Certificate (EPC)?
All properties that hit the market - be they rented or sold - require an EPC. As they are valid for 10 years, you won’t need to do this often, but you definitely will need one in order to be compliant.
Has the property got an up-to-date gas safety certificate?
Similarly, you must have a gas safety certificate in place for the property prior to any tenancy commencing. Unlike the EPC, these are only valid for 12 months and they must be carried out by a Gas Safe registered engineer.
Have you performed a Legionella risk assessment?
Although Legionella risk assessments in and of themselves are not a legal requirement, providing a home that is free from hazards and safe to live in is, so carrying one out makes sense. These can be conducted by the landlord, providing they feel comfortable doing so, and should be performed periodically.
Are there working smoke alarms on every floor of the property?
As per above, it is a landlord’s responsibility to ensure the home is safe to live in, so smoke alarms on every floor is now a legal requirement.
Is there a working carbon monoxide alarm in every room where solid fuel is used?
While solid fuel won’t apply to every home, if you are planning on renting out a property where it is in use, you’ll need to provide a working carbon monoxide alarm in every room where it is being used.
Have you checked the Right to Rent?
As mentioned above, checking a tenant’s right to rent is an essential part of the process...and a costly one to overlook.
Have you ensured that your tenant’s deposit is properly protected?
Compulsory tenancy deposit protection came into force back in 2007, making it another legal requirement landlords need to adhere to. For a full breakdown of what they do and why they’re so important, check out our deposit protection guide for a deep dive into the subject.
Have you supplied your tenant with the correct documentation?
As well as all the behind the scenes stuff, you also need to hand over certain documents to your tenants when they move in, some of which can be included in your tenancy agreement. Other documents, such as the government’s ‘How to Rent” booklet, need to be physically handed to the tenant.
Renting a House in Multiple Occupation (HMO)? Have you got a license?
For those who are renting out a property deemed to be a large HMO, you will need the relevant license from your local authority. As we explained in out guide to HMOs, a large HMO is broadly defined as:
- A building at least 3 storeys high
- Housing at least 5 tenants, forming more than 1 household
- Facilities (bathroom, toilet, or kitchen) are shared with other occupants
The legal aspects of being a landlord can be a real headache, which makes it the number one reason why so many choose to hand the reins over to a property manager. Here at Petty’s, we are constantly updating and retraining our property management team to ensure all of our clients remain compliant.
If you would like help running your tenancy, give us a call. We offer a range of property management services tailored to suit your needs, so do reach out to discuss how we can help you minimise the inevitable stresses associated with being a landlord.
