OT Renting Out a Flat

You *must* have a proper tenancy agreement with all the proper notices served on the tenant before the start of the tenancy, otherwise you run a very real risk of granting the tenant security of tenure for life.

You can get the forms from stationers or even tesco.com but follow the instructions very carefully.

If you can find a good agent ...

If you live locally you are probably better managing it yourself.

You will need your insurers' and mortgagors' agreement and some mortgage companies will insist that the property is let through an agency.

Owain

Reply to
Owain
Loading thread data ...

Best advice now seems to be not to take exactly one month's rent as the tenant is likely to not pay the last month's rent leaving you with no deposit.

The comments about the legal hassles of getting rid of a bad tenant are spot on. We had one who stopped paying. We passed it over to our solicitor who managed to give them two months + 1 day notice. The tenant, no doubt advised by CAB, pointed out that the notice had to expire on a rent day so was invalid - this of course was at the court hearing six weeks after the first notice had come into effect (or not as it turned out). So start all over again, two months, six weeks, possession order .... eventually she moved. One false move and you're nailed for harrassment.

Our family business has been in letting since I was a kid and 90%+ of tenants are nice decent honest people. The problem, if you have just one property, is that if you have a bad tenant you have 100% bad!

Reply to
Tony Bryer

It's a long time ago now, but my sister worked for a managing agents who did all this. Of course they added 10% (or whatever) to the repair costs so didn't feel too constrained to keep costs down.

Reply to
Tony Bryer

Did the court give you costs and did you pursue it from her.

Reply to
Doctor Drivel

No, we'd probably have got £5 per month and never seen that. When it comes to bad tenants it's all too easy to throw good money after bad.

Reply to
Tony Bryer

Month and a half seems to be becoming the norm, even.

Reply to
Beelzebub

When I moved south, I rented out my house in Scotland. My mortgage was with the Woolwich and for a small(!) fee of £100, I was allowed to rent the property out for a period of up to 2 years on that mortgage agreement. Any longer would've meant having to re-negotiate the mortgage terms ie buy to let etc.

I used a letting agent, given I was nearly 400 miles from mine. They charged

12.5% per month for the privilege. The tenants were responsible for the rent, council tax and all the domestic bills. I had the same tenants for the 18 months or so and it wasn't a bad experience, although I'd probably not do it again. The rent just covered and no more. In my present house, I would not be able to recoup my mortgage payments in rent (down south prices now, see).
Reply to
Beelzebub

You need to budget for non payment, it always happens. Not every time but it will. You need to budget for far more than 2 months of course.

then youve got a problem. If you hand this over to an agent they'll charge good money for it, and they often employ handymen that will steam you as much as they can. Its common to find they charge inflated prices, and something that would take a 1 minute visit from you to fix is likely to cost you =A320-40.

You also have to deal with tenants who call you out when the light doesnt work, and you find its just the bulb gone. And the regular lost key calls. Put it this way, if they could get their act together would they still be renting, or would they have bought their own place?

ready made forms

Once you've paid the various bills, including insurance which is triple the price for rentals, higher interest level for the lender, ongoing repairs and renovates after a trashing, and deducted the unpaid rent, the chance of even coming close to paying the mortgage is just about zero. If it did, everyone would be doing it. Rental is a long term investment business. I know this from spending many hours running through sets of figures.

Dont forget to factor occupancy in, which wont be 100% over the long term.

All the tripe on tv seems to be giving a lot of people the idea that they can easily make money on property rental. Its just not like that. I had one friend who 'invested.' He was lucky, only ended up losing

4,500 on the whole thing. His phrase was 'never again.' And another that ended up forced to sell and lost most of his money.

Drivel is right except for one point: when a court is faced with the choice of you housing the tenant or the local council, they'll frequently let you do it at no cost to them. The courts for the most part could not care less what your problems are, youre just a ready supply of free housing to them.

If you dont believe me, ask some landlords.

NT

Reply to
meow2222

If your server has it, try uk legal newsgroup-very good!

Reply to
fred

In message , Doctor Drivel writes

Makes no difference even if you can trace them... if they've got no money, you get no money or.. If they've got money, they will plead poverty and a judge will let them pay £10 per month. They will pay it for a few months, then stop... and you have to go to court again.

Reply to
Richard Faulkner

Furnished vs unfurnished is a difficult one. There tends to be not a lot of difference in rent; worth asking local agents which has most demand locally. If you leave it furnished, you need to be sure all the furniture comes up to legal standard as regards smoke inhalation in a fire; the tenants may trash it (although you can offset vs rent income); tenants may not stay as long because moving out is far less upheaval. If you let unfurnished, presumably you'll have to sell or stire your furniture.

Definitely have the tenant pay the council tax - you let the council know when they move in, then if they don't pay up it's nothing to do with you (although this is likely to change). Same thing applies to all the utility bills; if you give them the meter readings and tell them when the tenant moves in and out, you have no liability at all if the tenant does a bunk without paying. I don't know how your service charge works - is it significant, and would the freeholder chase you for it if the tenant didn't pay them? Presumably so - in which case I think I'd just build it in to the rent.

Sounds like you definitely need an agent to manage the place then, although it's very expensive for what they do. No need to involve lawyers, the agent will set up an Assured Shorthold Tenancy agreement when the take on the tenant - that's one thing they do actually have to do for their fee! (Don't even *think* of doing it on a handshake...)

An excellent idea, true, but not actually compulsory unless the property was built recently (ie, since building regulations insisted upon these being fitted).

Agree with all that, but if you use an agent, they will find the tenant for you and *should* do all the above! If you're a first-timer, you'd be well-recommended to leave sourcing the tenant to an agent.

Most important is that you vet the agent you choose - check their T&Cs and fees very carefully, and make sure you use one who's a member of the trade organisation ARLA or equivalent. Be assured that there are plenty of really naff agents out there.

One good example of how agents stiff a wet-behind-the-ears landlord (and yes, I was he!) is to set up a 6-month AST, for which they will charge the landlord and tenant handsomely, and then in 6 months time, and every

6 months thereafter, will charge again for 'renewal' fees. Whereas, it's completely unecessary to renew an AST - after the initial period has expired, it legally defaults indefinitely to a 'periodic' tenancy, which retains all the T&Cs of the original tenancy agreement, with the landlord having to give the tenant 2 months notice to quit, and the tenant giving the landlord 1 months notice.

Touch wood, I've never yet had a problem, or any tenants who weren't 'good pay-on-time' types. Have to say I do vet them very, very carefully though, and also trust my instinct.

Check out

formatting link
- excellent info resource, and has a very helpful forum.

Good luck David

Reply to
Lobster

No he doesnt - I've had loads of tenants not pay council tax and have never been approached for it. And the council know exactly who I am and where I live.

Reply to
Richard Faulkner

Reply to
John

Here you go Fred these people need help.

free.uk.diy.home

Reply to
The3rd Earl Of Derby

You cant say "must" anymore as, without a written tenancy, it is assumed to be an Assured Shorthold Tenancy. In fact, using the wrong form of tenancy agreement could create exactly the problem you are suggesting, so a verbal agreement could be as good as any - except you wouldnt be able to use the Accelerated Possession procedure, and would have to attend a hearing if you want possession.

I use the RLA forms, which you can get by joining, (possibly as a guest), and have used them successfully in several evictions.

agreed

Moot point. The mortgage agreement usually requires this, but you dont actually need it.

Not trying to be awkward, but this is a very trick area.

Regds

Reply to
Richard Faulkner

In message , snipped-for-privacy@mailinator.com writes

Furnished seems to be in more demand in most places, and you can claim

10% of rent collected as an allowance for depreciation. You can set this against your rental profit if there is any.

The service charge is your responsibility, so you should pay this. The tenants are responsible for utilities and council tax, so you should leave it to them to pay this - if you build these things into the rent, and they dont pay the rent, you lose both the rent, and remain responsible for the bills.

The $64 million question - tenants are a bit "luck of the draw". The best thing you can do is make sure they are working and can afford the rent, and get a reference off their previous landlord. Whether things work is down to you.

Dont take on tenants on Housing benefit!!! Dont let to someone who has to move in "tomorrow" - i.e. before you can do the checks.

Dont use a solicitor unless they are top class specialists in Housing e.g. they act for a local Housing Association or similar. I used one once, ( a mate of mine), and all of his paperwork was out of date, even though the firm had a Housing Specialist.

I use a letting agent to let and manage most of my properties, but beware, because some are absolutely useless. I use another agent to let one property in manchester city centre, then manage it myself, (it's new, so not much to do).

It took me several years, (a lot of internet research, and some very bad experiences), and quite a lot in lost rent, to learn how the system and the law works, so you might be best getting an agent to do it for you, (as above, I use one even though I could save a lot of money doing it myself).

Where is your flat - if it's anywhere near me, I'll recommend the agency I use.

Reply to
Richard Faulkner

In message , Lobster writes

Some of them belong to the various trade associations

Reply to
Richard Faulkner

You need to budget for non payment, it always happens. Not every time but it will. You need to budget for far more than 2 months of course.

then youve got a problem. If you hand this over to an agent they'll charge good money for it, and they often employ handymen that will steam you as much as they can. Its common to find they charge inflated prices, and something that would take a 1 minute visit from you to fix is likely to cost you £20-40.

You also have to deal with tenants who call you out when the light doesnt work, and you find its just the bulb gone. And the regular lost key calls. Put it this way, if they could get their act together would they still be renting, or would they have bought their own place?

ready made forms

Once you've paid the various bills, including insurance which is triple the price for rentals, higher interest level for the lender, ongoing repairs and renovates after a trashing, and deducted the unpaid rent, the chance of even coming close to paying the mortgage is just about zero. If it did, everyone would be doing it. Rental is a long term investment business. I know this from spending many hours running through sets of figures.

Dont forget to factor occupancy in, which wont be 100% over the long term.

All the tripe on tv seems to be giving a lot of people the idea that they can easily make money on property rental. Its just not like that. I had one friend who 'invested.' He was lucky, only ended up losing

4,500 on the whole thing. His phrase was 'never again.' And another that ended up forced to sell and lost most of his money.

Drivel is right except for one point: when a court is faced with the choice of you housing the tenant or the local council, they'll frequently let you do it at no cost to them. The courts for the most part could not care less what your problems are, youre just a ready supply of free housing to them.

If you dont believe me, ask some landlords.

Reply to
Doctor Drivel

Thank you so much for all the replies. It seems like there's so much to consider. The problem is I might not be able to afford to sell as I probably wouldn't make enough to pay everything charged against the property. But then I also might not be able to afford the mortgage either if I stay!

I'll have to look into the options more I think before I do anything.

Reply to
Stephen

Probably a Scottish - English law difference? ...he says diplomatically! I certainly agree with Richard as far as England goes.

David

Reply to
Lobster

HomeOwnersHub website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.