Being a landlord - Scotland

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Is anyone a landlord? I’m curious to find out how hard it is and how much money you need behind you for potential problems within the property. I’m set to inherit a house and I really don’t want to sell it in the near future, but the idea of being a landlord terrifies me, especially as I don’t have any savings and live pay check to pay check

If you're living hand to mouth why wouldn't you want to I sell it?

If you don't have any savings, how will you redecorate the house (assuming it currently belongs to quite an elderly person) so it's neutral and appeals to renters? How will you pay for all the certificates you need? How will you replace a broken appliance or do other urgent repairs?
Sell the house.

Nothing needs done to the property, it’s already in rental condition, no boiler, recently rewired. I’m asking how difficult it is to become a landlord. I do feel hesitant in case anything went wrong that was a huge bill though.

Lots of reasons for not wanting to sell. The way we live is nothing new to us and we manage our way through quite easily, just without savings.

I am a landlord, not in Scotland but the principles are the same. The tax you will pay might be surprising, if not already higher rate taxpayer, the rental income may knock you into higher rate, so you will pay 41% tax or more on the rental income. You will need an emergency fund for things that go wrong, and things do go wrong, allow for maybe £2k starting out and build it to between £5 - £10k. If you are not an experienced landlord, it’s worth having an agent set everything up for you unless you are confident and can work it out - there are quite a few requirements around setting up a tenancy - EPCs, EICR, local authority licensing, inventory, which tenancy agreement etc. it’s not a passive income, tenants will be on to you after a storm if slates come off, when an appliance is playing up, if there is damp etc. You run the worry of having bad tenants that don’t pay and/or wreck the house. So I recommend be there when tenants view and be part of making the decision on who rents out. Take some time to get insurance that works for you. A good broker can talk you through what’s available. Many many landlords are jacking it in, so you will need a really good reason and strong resolve to go ahead. It’s all do-able but not for the faint hearted.

I would not be a landlord for all the tea in China. If you do decide to rent out get a good agent. Many are rubbish and the mistakes they make can land on you! For example if they dont protect the deposit its the LL who gets sued. Sell it or put it in an auction. Dont leave it standing empty. Or you will be saddled with expenses like council tax etc plus the cost of upkeep. Even worse it could be broken into. vandalised or squatted. The nice 4 bedroom house next door to me has been empty for 2 years with two attempted break ins. Why its been left empty is beyonmd me but their decision.

I’m an estate agent/letting agent in Scotland with many years experience. The market varies greatly depending on where you are.
I know you say the house is rental ready, but you need an EICR (electrical installation condition report) Gas safety Certificate, boiler service certificate, (this is often overlooked by landlords, but insurance companies come looking for this, in the event of a claim) legionella risk assessment, valid EPC, landlord registration number from your local council.
I would highly recommend Rent Protection Insurance, won’t pay out for the first 1-2 months, but will pay lost rent while the eviction process is going through.
It is currently taking 12-16 months to evict tenants through the First Tier Tribunal. An application can only be lodged after the tenants are in one month’s arrears for 3 consecutive months.
I would strongly suggest removing all white goods, or “gifting” them to the tenants. Making it clear, if they break they will not be replaced.
I would also strongly suggest you do your homework on your letting agent.
How stringent are their checks? Some of them just accept the first ‘vaguely suitable’ candidate, so they get paid quicker.
As I said, I’ve done this for a long time. I tell all my landlords. I will take longer to find the right tenant, not the first tenant!
You are very welcome to message me.

Being a landlord is a business. Apart from all the practical issues already mentioned, it requires a significant investment in time to get up to speed with all the legal requirements. It’s not a hobby that can be picked up as you go along.

I am not familiar with the Scottish process, but in England it is very difficult to evict tenants, even if they are in arrears. I can’t imagine that it will be much easier in Scotland.

No way would I become a Landlord in today’s environment. Once my existing tenants leave I’ll be selling up.

I'm a LL but in England not Scotland. As long as you are organised it's all doable. I. England you need How to Rent booklets downloaded from government website. This must be issued before contract is signed. You can buy a contract template and just fill in tenants details. I use law depot. You must print off EPC rating which currently must be E or above but in 2030 must be C or above. This must be carried out every 5 years for a rental property. You need a gas certificate every year carried out by gas safe engineer. I get them to service boiler at the same time. You need an electric certificate every 5 years. You would get huge fines if you let any of these expire even for a short time. You cannot allow a tenant to move in before you issue all of these to them. I get them to sign and date a document to say they have received each one before I give keys. I photograph every room from 2 angles including I side of cooker to show it has had a professional clean between tenants. You would need an itinerary of any white goods and furniture in house included things like blinds and curtains. In some areas you have to register house with council and pay a fee but other areas not needed. I use an EA to find tenants and financially vet them for bankruptcy, affordability etc. then they give me a list of potential tenants stating how many in family, where they work etc. occasionally a tenant will ask EA to give you a letter giving reasons why they want this house eg school catchment or near to grandparents etc. It's very hard selecting the tenant as in truth most of them would be suitable but you have to pick one. I like to meet the one I select before I give contract. Deposit must be lodged with approved deposit scheme. I know in Scotland at one point they had rental caps but not sure if this is still the case. I like to deal with my tenants myself rather than use an agent as I prefer to build a professional relationship with the tenant. They have my mobile if they have any issues they can contact me directly. As a LL I aim to replace broken appliances within 48 hours and get any maintenance person in to assess any repairs within 3-4 days unless emergency then within hours. As a LL you have to treat it as your job. I let tenants know if I'm going on holiday and give them alternative number to contact for any issues. I expect to redecorate/paint every 4 years and between tenants and replace carpets about every 6 years. I keep a £8-10k float for repairs and maintenance. You must keep all receipts for works carried out on houses and also have valid insurance for each house. I quite like doing most of it myself. It takes me about 4 hours a week.

I got an agent and they were pretty lousy. I wish you’d been my agent. We ended up with tenants super quick. They claimed they were doing checks but when they left two years later, original 1930s fittings were broken, there was pen all over walls, carpets were destroyed. It was heartbreaking as it was my home. I’d had to let as I was moving away because of work.
OP I would say get a good agent. Do your checks. Getting certification is relatively easy with your local council, and you can get a letting agreement template on the Scottish government website so you can do it alone but for peace of mind I’d recommend a good agent of they can be found.

You have some good advice above.

Do some more reading here https://forums.landlordzone.co.uk/c/welcome-start-here

I would strongly suggest you get good advice from an independent financial advisor who can look at your total situation and talk you through all your ramifications. Otherwise, getting into messes could be easier than falling off a chair.