Becoming a landlord can be a mixture of excitement and nerves. You are offering someone a home to live in, which is an amazing thing to do – however it’s not to be taken lightly. There are a lot of elements when it comes to learning how to be a landlord. Handing over control to potential tenants of one of the most expensive things you own and taking responsibility for where someone lives is a big deal!
Don’t let that scare you though. Being a landlord can be really rewarding and profitable. It’s just important that you get a few things right. Here’s my top tips for first-time landlords…
Choose the right tenants
Before you even undertake your landlord duties, you must find the right tenants to live in your property. You’ll probably find that a wide range of people will be interested in your property once it goes on the market. What does the ideal tenant look like for you? Is your property perfect for a single person living alone? Is it a great space for a young family, or it is a bungalow with great access that would best suit someone elderly?
Think about whether there are any particular tenant groups that you feel would be beneficial to market to. When the applications start coming through, be sure to screen everyone properly. This may involve checking their credit score, their income and any previous landlord references.
It’s also very important not to discriminate against any potential tenants. There are certain things that you cannot reject someone over. This includes their marital status, being pregnant, their age, or any of the ‘protected characteristics’ such as nationality, gender identity, sexual orientation, disability or religion.
Have a detailed tenancy agreement
You’ll soon realise that your tenancy agreement becomes the holy grail of your tenancy. It’s the thing that you can fall back on and turn to if you need to resolve any issues. A tenancy agreement details everything that was agreed upon at the start of the tenancy. This could include clauses about smoking, subletting and when the rent is due each month.
Anything that is important to you and that you need your tenant to agree to should go into your tenancy agreement. It’s a very important document, so creating one can be a bit daunting. Luckily, there are loads of templates online that you can use – just make sure you double-check that it’s a UK-based template.
Take out landlord insurance
Before you get anyone living in your property, it’s strongly advised that you take out landlord insurance. You aren’t actually legally required to take out landlord insurance, however mortgage lenders will usually insist that you have cover before they give you the go-ahead to take on tenants.
Landlord insurance will ensure that you are covered against many different eventualities that can be worrying for a landlord, such as malicious and accidental damage, loss of rent, and unoccupied properties. You can follow here to learn how seeking help from a public adjuster can help you with your insurance claims. Make sure you compare landlord insurance to ensure that you are getting the best policy available to you at the best price. As a first time landlord, you’ll need good cover more than ever.
Collect your rent
So, you have tenants in your property. Great! Now you need to make sure that you collect the rent on time each month. This is something that you shouldn’t really budge on. Yes, there may be times that your tenant struggles to pay you. If you have a good relationship with them then you should be able to work this out.
The rent is your revenue. It covers your mortgage repayments (if applicable). Without the rent payments, you won’t get very far as a landlord so it’s important to make clear from the start that paying their rent is the least your tenant can do. Try not to feel too awkward about setting this standard – but it’s important to remain reasonable so that if your tenant is having financial problems, they feel they can come to you and be honest.
Be respectful and kind
Landlords get a bad reputation these days. Many have tarnished the name by being greedy, unfair, and disrespectful. Don’t give your tenants a reason to believe this stereotype! Consider tenant retention; happy tenants make for long, happy, and unproblematic tenancies – and who doesn’t want that? Keep a good line of communication so that your tenants know that they can come to you with an issue. If they need something fixing, don’t wait weeks before getting round to it. Make sure you take your duty of care seriously.
Perhaps consider leaving your new tenants a welcome gift; a bottle of fizz and some chocolates or takeaway vouchers never go a miss. You could also make a note to send them a birthday and Christmas card each year. Little things show that you respect your tenant, and this will hopefully mean they treat your property with respect too!