Letting house for first time - please let us have your kind advice.

[jaamy]

Hi
Given the state of the housing market and the fact that we have been trying to sell our house for nigh on 4 years, we have pretty much decided that we are going to need to let it if we want to move to another part of the country.

I did a little search on MN on the subject and couldn't find any current threads so forgive me if this has already been asked but we really need some advice.

DH has been to see letting agent and mortgage advisor on the matter so we know the figures involved. I just wondered if there are any top tips from seasoned landlords. We will be using an management agency and have had quotes for a buy-to-let mortgage as we still have a mortgage on the property in question.

Our main concern is that if we have prolonged vacant periods that we will not be able to reach the mortgage payments.

Any comments welcome - good or bad experiences.

TIA :)

Am on phone so will have to be brief. Some agents offer a service of guaranteed income for 11 out of 12 months in a year. You pay a higher % rate for this premium service. We rented our house for same reasons for three years but moved locally so did everything ourselves as we were able to look after the property and manage the tenants. Mortgage payments are usually interest only, so might be lower than you imagine and so you might not find under occupancy to be too much of a problem in that regard. It also of course depends how muh of a rental market there is. We were lucky as in university city with high population turnover, people looking for mid-term lets and a very easy to maintain house just nearby was always going to be rentable. Good luck!!!

Thanks Racers.

We are less than a mile from a hospital where (I believe) doctors are placed for rotations and will need homes for several years at a time. In fact, when we first put the house up for sale a doctor offered to rent it from us for 5 years and we turned him down because we thought we could sell it:(

We will look in to finding a letting agency that offer a service of guaranteed income for 11 out of 12 months in a year as that is something that really concerns us. Top tip, thank you. We are intending to move about 100 miles away so managing it oursleves would be difficult.

The mortgage that we have looked at is interest only so we know the cost of that. Other 4 bedroom properties in the area seem to get snapped up really quickly (we have been told by EAs and there are rarely any on the house selling websites).

From your post it sounds like you no longer have your letting property. Do you mind me asking why you got rid of it? Did you sell it easily in the end?

Thanks very much.

I became an accidental landlord and let the house to a former colleague and managed the tenancy myself.

A Nightmare rent late, property a mess and then upped and left with minimal notice. I had to retain a sizeable chunk of the deposit to cover repairs,cleaning etc.

Went to a management company and while the 10% fee is a joke most months they have been good in keeping the tenant happy and the property in a good state of repair. They communicate efficiently and are actually worth their fee when they find a plumber at short notice etc.

I don`t live close to the property so you might be able to manage maintainance more easily than from 200 miles away.

If you rent it unfurnished don`t leave any appliances as a kind gesture because you will still be liable for their repair and maintainance. I made that mistake with a cooker. It would be better to sell them to the tenant if you want to leave something.

Be aware that if you use a company then you will have statutory energy ratings and that some tenants may use these to press for improvements to insulation/double glazing etc.

Feel free to PM me if you have any questions, will answer as soon as I can.

Good luck

DZH - thank you so much for your tip about appliances. We have a built in oven and would have thought of leaving it as is only a year old but after your comment we will def only give any tennants the option of buying it (if we don't need it in our new home).

We are set on going with an agency - good to hear that you have had a reasonable experience with yours.

We have an EPC from when we first put up for sale as it was compulsory then. The house is only 13 years old so has double glazing/insulation, etc but will look in to this again.

I may get back to you if we think of anything else. Thanks again.

I'm a LL and have self let and managed for 10 years, and just now am looking into using an agent. In fact I have met with 4 today!

You will need an EPC (energy performance cert). Get them online yourself. Cheapest I found was £50. Agent will charge you in excess of £100 for this.

You need a gas safety cert every 12 months - check out local plumbers for this.

Get landlord insurance. Pay for a decent cover. Make sure it covers malicious damage. I have learned that the hard way. Last tenant destroyed my house (literally house was stripped back to the joists) and I didn't have malicious damage cover so I had to pay myself. It has nearly finished me financially.

Get a few agents in. I think I have decided on a local company but I was quite impressed with Your Move who are national. They did a good rent guarantee scheme, its 2.5% of the rent each month and basically if they don't pay after the first month they give you the rent for 6 months and £15k legal fees to get an eviction.

From my personal experience - let unfurnished.

Take a very detailed inventory, with photographs (agents can also do this, Your Move charge £120). Get tenant to inspect with you and sign it.

You are going to have to detach from this house. Even good tenants will not treat it like your home, they treat it like theirs (which is only right, but can be hard to cope with).

Personally between each tenancy I allow enough money to repaint and re carpet. Usually I only re paint and have the carpets cleaned, but I allow money for it.

Remember you have to declare this as an income for Mr tax man. Also look into what costs against the property are tax deductable, like mortgage intrest and agents fees. Not all repairs are.

Have a look into local tradesman/companies like british gas who do maintenence contracts for houses. What I am going to do is let the house fully managed, but without repairs. I will be informed of repairs and get my trades to do them. It will be cheaper. The only exception to this is that they have a £100 max to use in an emergency if they can't contact me to have an emergency trade come out to make the property safe.

Be wary of their costs. It seems standard that that will authorise works up to £100 without your permission then bill you. Be aware that may mean a £10 part and £89.99 labour to their handymen. This is why I have opted out of this.

There is probably loads more so ask any questions, there are a few LLs kicking around here and we can usually point you in the right direction

I rent unfurnished, and would not even consider a place with no cooker, especially if it had been built in. Just saying, like.

We rent our house in the UK and managed to retain our original mortgage as we intended to return to live in the property. We probably still will but not in the next few years. I understand that many mortgage companies used to allow you to keep your mortgage for three years. This can be an economical option and allow you to keep repaying the principal.

I have landlords insurance through Hamilton Fraser and the landlords association which is very cheap. I've just checked and it includes malicious damage up to 25K (phew!).

It is the norm to provide at least a cooker, even if unfurnished.

Are you seriously going to remove a built-in cooker and leave a hole?

Good luck with finding tenants that will accept that!

I always leave an oven/hob and extractor in. Have previously provided a washing machine upon request.

The agents I spoke to yesterday said they usually require a fridge and washer. I said I will supply if I really have to. I'm reluctant with the washing machine because that is what so often goes wrong. If its my machine and it leaks I have to fix it and the damage, if it is the tenants, they do.

Couldn't you get a cover plan for the washing machine?

I probably can, its not the fixing the machine that worries me though, its the flood damage if it leaks.

Either way, if they want one I will provide one because an oven and washing machine are expected in an unfurnished house (the fridge has never been mentioned untill that agent asked).

I'm in my third rented house. None have had a washing machine or fridge (fine, as I have my own) but oddly, all three have had a dishwasher! (And a cooker...)

The houses I have rented are all large-ish country places, I guess it depends on your target market.

Marking place with interest. We have a property in June becoming empty, it needs repairs before going back on the Market.
Thinking I will get an agent to find the tenant and I will manage but not 100% sure.
Must check what landlord insurance I have.
K

Argh - just spent half an hour typing out a reply and MN has lost it on me!!

Briefly...

I see that the oven has caused an issue. Thanks for your comments, I will bear that in mind, although many houses are sold with a hole where the oven should be so I'm not sure why rental properties should be any different. We will just have to look into maintenance/repairs plans if we need to.

Oreo- lots on that list, thanks. So far the agancies we have looked at have pretty similar rates and services.

We had Northwood here today who will charge us roughly £200 a month for a fully managed service - including income when the property is empty. We just need to weigh up whether it is still affordable on that basis. We really can't afford to have the property not generating an income for even one month! Anyone else any experience with Northwood?

LittlestKiwi - Unfortunately we need to change mortgage to release some of the equity in this house so not an option to keep current repayment mortgage although it is cheaper than a buy-to-let interest only mortgage!

Will look into Hamilton Fraser and the landlords association. Thanks.

OldLadyKnowsNothing - can I ask why this is your 3rd rental property? Did you have a bad LL experience?

Hello sorry not to come back - post so rarely these days that I never use 'threads I'm on'! It was Northwood who I looked at but we didn't need that service, decided to risk it. After a couple of years, our tenants left so we decided to have another go at selling and were lucky. On top of everything else there are capital gains taxes and so for each year it is used to rent, you can incur tax at 18% (direct.gov for info, it's complicated). Again, on phone and not remembering exactly but it worked out better for us to sell and release the equity to put against our current house. We never planned it to be a long term venture and were fortunate to have fab tenants. I think you are obliged to provide tenants with the means to heat the house and cook food - I agree I would not rent a house without a cooker. have a look at tenant guides online to see what the expectations are. There are also site to advise landlords. Will try to remember the one I used...

This is the site I used Although maybe more useful for me as doing own tenancy agreements etc?!

Another useful one

a tennant here:
leave a folder with copies with the manuals of all appliances/heaters/window locks in a folder for the tennants.
our first landlord left it and it was enormously helpful. especially when the property is in an area that attracts immigrants (somethings just are very different in the uk from other european countries).

a sort of former tennant here.

do not overly bother your good tenants who pay over 2K a month and keep the house clean and tidy.

do not let your self into their home when they are not there.

do not insist the drive needs to be jet washed and the stones bleached white because this 'dirtiness' will put off other potential tenants in the future.

do not complain if the bark chippings have been upturned by the birds and scattered 10cm out of the borders as this does not put off future tenants.

detach your self from this house. It is a business transaction. Don't become emotionally invested in this property when you have moved on.

Golly... its good to let off steam

I have been a landlord and a tenant (sometimes simultaneously). I have always provided appliances - at least cooker, fridge and usually washing machine, and would expect the first two of those to be provided when I was renting.

Tenants on short term contracts or those from abroad (or who move a lot) do not usually want to take appliances from place to place. They also might find that difficult to afford. Everywhere I saw when renting unfurnished provided kitchen appliances.

I let my old flat and self manage in London. I prefer this since without agent's fees, both my tenants and I get a fairer price, which means way less hassle as the tenants don't see you as a total b. if someone is paying far over the odds then who can blame them ringing up every time a lightbulb goes?

I found most agents we met sloppy and irritating, and meanly aggressive on price, and I think you can do the management work yourself. However, I live locally to my property. And this is London, which is nuts.

I would say that if you have a house niggle that you overlook, eg slightly dodgy boiler, put it right cos a tenant will understandably complain. Best to be realistic before it is an emergency job.

If you do put in a gas cooker, it might be worth getting one that automatically shuts off the gas if the hob doesn't light? Currently this is the law for flats, but not for houses, but if this is a long term thing, I might be expecting regulation to get even tighter. Tiny thing though.

I let my old flat for about 18 months after moving in with dp. I was completely naive as i had myself been a quiet, undemanding tenant who paid regularly. My tenants paid but started by negotiating hard on the rent and then asked for the flat to be professionally cleaned. I didnt ask who would be living there so was shocked to discover the mum and 2 kids had moved in her parents and her brother and his girlfriend. It was a 2 bed flat. They kept it quite nice but the heavy wear took its toll. They complained about the flat being damp but they had caused it by not ventilating! Things started breaking and as i was pregnant with dc1 i decided to sell up. the rent covered the mortgage but not really the extra expenses so i had had to subsidise it a bit. Renting wasnt exactly a "goldmine" and it was difficult selling a flat with tenants in residence who didnt care about how it was presented. luckily i didnt have to deal with capital gains tax as i had been away for less than 3 years but that could have been a financial disaster so needs careful consideration. You can download current guidance off hmrc website although it can change. Do your sums well. It may work out cheaper and less stressful to sell at a reduced asking price.... Sorry to be gloomy! Good luck.

I am a long term renter to a private landlord. He provides the four walls, the fridge, cooker, washing machine and freezer. In return we have looked after the house and fully decorated it. Not all tenants are bad people and I would never buy an oven or a fridge. I pay my rent to cover the mortgage and the maintenance and repair of the goods in the house, so I expect a prompt and polite service from my lovely landlord.

Long term landlady here. I provide cooker, fridge and washing machine in a clean empty flat. I self manage and always have HB tenants. I enter the properties once per year at my tenant's request when we renew the leases.
Get yourself a list of good trustworthy trades people to fix any little problems quickly.

We have rented a flat for ten years and we provide white goods. I thought you had to provide white goods to count as an assured tenancy.

I suggest you use an ALARA letting agent if you don't want to do the work of looking after the property.A good letting agent can hold your hand about making sure you comply with the law. Ie. gas and electricity safety certificates and keeping the desposit in a protected account. It is a good idea to have legal expenses insurance for the first six months.

You have to expect to pay some maintaince each year. There will be some wear and tear.