When it comes to managing rental properties, there are a lot of do's and don’ts. This guide will give you a brief overview of some of the most common and expensive mistakes landlords can make and how you can avoid them.
Think of being a Landlord as a job
Managing your property and tenant is a job that requires you to be organised and proactive. You will find it easier to stay on top of everything this way and it could save you from costly mistakes further down the line.
Furthermore, you will need to make sure the tenant is looking after the property and that they haven’t overlooked any damage such as a blocked drain, water damage, mould, etc. The best way to do this is to carry out regular visits to the property, ensuring you’ve notified the tenant in advance.
Do sufficient referencing on potential tenants
As a Landlord, you need to be sure that your prospective tenant has the means to pay the rent. That’s why tenant referencing is such a crucial step when renting out your property. Make sure you check out their background by verifying their references from employers, former landlords and find out if they have any history of late payment.
It's definitely worth the cost to obtain this information before making decisions about letting out your property to potential tenants because not doing so could prove to be much more expensive in the long run.
Protect the tenant’s deposit
It is a legal requirement to register the tenant’s deposit in a deposit scheme. If you fail to register the tenant’s deposit within 30 days of receiving it, you can be prosecuted for up to 3 times the amount of the tenant’s deposit and lose the opportunity to be reimbursed for any damage or rental arrears the tenants may have incurred.
This is another expensive mistake that can easily be avoided by making it a priority to put your tenant’s deposits into a tenancy deposit scheme as soon as you receive it. Don’t forget to notify the tenants as well once this has been completed along with any relevant details they may need.
Take an inventory
We always recommend that you have a professional independent inventory prepared for your rental property. Having an inventory is essential, without it, you would most likely be unsuccessful in making any claim from the deposit, should it be necessary. The inventory list should be detailed, including a full description of each room, plus all the items in it and their condition. Details and descriptions for the outside of the property will also be included.
Notes of marks, dents, stains, and general condition should be made prior to the tenant moving in so that this can be used as a comparison when they vacate. Most Inventory Clerks will take pictures of each room and any items of furniture or furnishing within it to provide further evidence of the condition.
Get the right insurance
It is important to take out the right insurance policy for your rental property, to do this effectively, you need to understand what you are liable for as a landlord.
Landlord's need specialist landlord insurance because regular home insurance doesn’t cover rental properties extensively enough. Specialist landlord insurance products take both the tenant and landlord into account and will keep you protected from scenarios that you probably wouldn’t find yourself in if you were just a regular homeowner. For example, if your tenant has an injury in your property due to no fault of their own, such as tripping on a loose floor tile, you could be sued for damages.
It’s your responsibility to make sure your property cover is adequately designed to deal with claims like these. You may also want to consider taking out rent, and legal protection policy's to give you peace of mind should your tenant fall behind with their rent and fail to vacate the property.
Keep an eye on the property
It is imperative that you keep an eye on the property and visit from time to time to ensure your tenants are taking care of it. If you let your rental property for several months without ever visiting you may end up having to deal with a whole host of issues, which could prove to be expensive for you.
To avoid this, schedule regular visits to your property, you must allow your tenant's peaceful enjoyment of their home, so ensure you contact them and arrange a mutually convenient time with plenty of notice. It’s usual to visit two or three times during a years’ tenancy. These visits can be a useful way to not only keep an eye on your property, but to also address any issues such as repairs and maintenance as well as to maintain good contact with your tenant.
If you are unable to keep an eye on your property because you live too far away or you are out of the country, then consider employing a reputable agent who can manage your property on your behalf.
Keep records of all your communications with tenant’s
Save all written records and documents of communications you’ve made with your tenant in connection with your property. It is important to keep this information in case there is ever a dispute which needs resolution. So be sure to save copies of emails, text messages and voicemails along with making notes of any conversations you have had.
Employing a good managing agent
Be wary of agents who operate, without being members of any redness scheme. All estate agents are required to register with one of three government-approved letting agency redress schemes available.
As members of The Property Ombudsman (TPO) independent redress scheme, we abide by a strict code of conduct. This means that we provide a higher standard of service and consumer protection to both tenants and landlords.
Every reputable estate agency or agent is a member of a redness scheme, meaning that they have chosen to follow the strict code of conduct set in place by the various redness schemes and operate to the industry standards. So, If an agent isn’t a member, then it’s a gamble as to what kind of services you are going to receive.
Looking for a reputable estate agency?
haart is a multi-award-winning estate agent and are members of ARLA Propertymark, SAFEagent money protection scheme, The Property Ombudsman and the National Approved Letting Scheme.
We are here to help our customers obtain more information about how to maximise their investments in the current property market. If you are looking for some advice, then contact our property investment expert Kate Hurles on 07960 120267 or firstname.lastname@example.org