Learning to be a landlord?

[ElizabethinherGermanGarden]

I'm moving in with my partner. He doesn't have a mortgage so isn't charging me any rent - we're just sharing bills and food and day to day living expenses. It means that I can keep my own house and at the moment I just can't decide what to do with it.

I'm considering renting it out but I am very aware that I know nothing about how to do this - I haven't even rented on my own behalf for over 20 years so don't have relevant experience either as renter or landlord. Lots of threads on here saying 'don't do it' have put me off a bit. On the other hand, my house is empty most of the time and I'm paying the mortgage etc.

Is there a course or something where I could learn about what being a landlord entails? Is there some reputable body that offers something like this? Ideally, I don't want to have to do loads of research or learn from my mistakes - I want someone to teach me properly. Is this a thing? Does anyone have advice on where to start?

Ignoring the playground jealousy up thread ( waahh! Someone has more money than I do !! Waaah!) The other thing is that if your relationship breaks down and you need to move back into the property, you are looking at months if not years to evict. And yes, you have to detach because it will be someone else's home and if you are unlucky, it could be trashed.

Just to add again....as in my previous post....yes it can go wobbly but we have had tenants for last 8 and 12 years....absolutely no issues at all and they keep the gardens lovely with plants and flowers etc....give it a go...if you get the insurance policies etc then you are covered for any issues.

It sounds to me like you need to talk to your partner and maybe a solicitor to see if anything else could work. For example could you sell your house and buy a share in his by putting the proceeds of the sale into trust for his DD? Could you sell it and put proceeds onto trust for your children if you have them?
Or sell the house and buy a property with the intention of renting it out - you could then cover the cost of management fees and repairs out of the sale proceeds

@KenAddams

There is online training course if you search Google and go to landlord accreditation

That's a really useful pointer, thank you.

@OverTheHill50

To be honest OP this is the bit about your earlier posts which would worry me most: There's a lot of emotional baggage tied up in it all

If it's your former home and you have an emotional attachment to it, then I'd strongly recommend you get an agent to manage it to remove yourself from the day-to-day aspects of seeing someone else live there.

I've never lived in my rental property, but I DID invest a lot of time and energy into it before we let it - cleaning, painting, gardening, upgrading etc.
I haven't been able to do regular landlord visits due to covid, but was
finally there last week after many months. It broke my heart to see the state the current tenant has let it get into. She isn't looking after it at all, and the cost of repairs I'll have after she's left will cost more than anything I'll be able to recoup from the deposit.

I know - it worries me too! I love my little house and if I didn't love my partner too I'd want to live there forever. But his house is his daughter's home and that's a no brained for both of us. I will have to find a way to be commercially minded about it rather than emotional.

@OverTheHill50

Obviously once you rent it out you put a % aside for current and future costs, but just to give you an idea, here are some of the things I've paid for in the last 2 years with a new tenant in a 10-year old modern house:

• listing and tenancy preparation - £150
• Landlord insurance - £220
• Cleaning and repairs pre-tenancy £200
• Gas Safety Check (legal requirement, annually) £85
• Electrical Safety report (Every 5 years) £300
• broken front door lock £80
• Cooker repair £75
• New extractor fan +fitting £120
• Plumber - 3 times for issues with things £300+
• Outside drain clearage £100
• Boiler repairs £400
• New smoke alarms £50

My husband and I do a lot of the practical household repairs to save labour costs. To be honest, getting trustworthy tradespeople who don't try to exploit you because they know you're a landlord has been my biggest headache!

This is exactly the detail I need! Thanks.

@earsup

Just to add again....as in my previous post....yes it can go wobbly but we have had tenants for last 8 and 12 years....absolutely no issues at all and they keep the gardens lovely with plants and flowers etc....give it a go...if you get the insurance policies etc then you are covered for any issues.

Thanks for both posts. What I would really love to do in an ideal world is let to someone really delightful who will be happy there. I suppose, if that's the case, I need to stop having it in the back of my mind as somewhere to go back to if anything goes wrong in my relationship. The two don't go together very well, do they? If I had lovely, happy, careful tenants, it would be pretty arseholeish of me to chuck them out just because I want to come home. There's a lot of food for thought in this thread and it's really helping to see it as a potential reality.

@Xanaduyourenotthatfar

Semi-accidental LL here.

On the one hand I totally understand people saying "don't do it", on the other hand I do think people on MN can be a little over dramatic about this topic.

Yes there's lots that can go wrong but that's the same with many things in life! I'd say as long as you have common sense, a back up fund for repairs and you go into it with your eyes open, you'll be fine.

I have done fully managed and fully self- managed and there are pros and cons to each.

Currently self manage a flat. Things that have gone wrong/ needed fixing in the last couple of years...
New boiler
Leaking shower, bathroom needed retiling
Heating system needed degassing
Light switch broken
Damp

All perfectly fixable, some by us some by getting someone in, amiable tenants.

A managing agent, IME, is useful on checkout if you have pain in the arse tenants who leave stuff broken, don't pay rent, etc - they can do all the chasing for you. If eg boiler breaks mid tenancy all they will generally do is call you and say "boiler has broken what do you want to do"

You do need to be prepared for some hassle doing it, but (touch wood) 90% of the time you hear nothing and the rent comes in.

I'd think twice if:

• I didn't have any flexibility in my time eg if there's a leak and you need to get there to help sort something out in an emergency, can you manage that? (If self-managed)
• I was scared of conflict or found it difficult to have commercial discussions with people. Sometimes you do need to be assertive and put your foot down on certain things.
• I didn't have the means to pay for eg sudden broken boiler
• I was disorganised, let admin get on top of me
• I might need to sell or move back into the asset in the near future - it's a long term thing, getting tenants out is tricky if you need to do it quickly on your timeline

If none of those are you, I'd definitely look at letting it.

Thank you for the reassurance. It sounds as if I would need to save up a buffer and get a managing agent. I could do that. I can't be on call myself all the time because work is pretty full on and I have a limited skill set.

You can learn if you are prepared to book the time in in advance and also prepared to put some time in during tenancies, even if there’s an agent.

You need to learn about legal responsibilities, costs (which might make it not worthwhile) rents, and things like what makes a good landlord in terms of communication, rapid maintenance when required and the legalities of contracts, notice period and eviction process. You need to understand tax liabilities in a yearly basis and capital gains tax when coming to sell, plus the need to have a vacant property before you market it.

You need to know it’s not easy money and all the hidden costs and risks such as voids, difficult tenants and how hard and expensive eviction can be. It isn’t a case of having the property, paying an agent and then seeing the money roll in with zero effort or time required.

You need to look into agents and know that even if you pay one, you will still need to keep an eye on things and much responsibility lies with you.

Expect to spend time ensuring standards are suitable and maintenance is done between lets and when needed during them.

If you have a mortgage, the ability to make money from this,especially with a sizeable mortgage is pretty low these days.

I wouldn’t categorically say don’t be a landlord. However, just finding yourself one accidentally isn’t really a pro-active choice, but pretty passive. Becoming a landlord needs to be a proactive, informed and active choice.

If you are prepared to get informed and be proactive so that you can deliver a good service to the tenants who pay rent, then it could be for you. If you haven’t got the time or inclination to do it well, just don’t.

I've been an accidental LL for the last 5 years but have just handed the management over to an agent.
Most decent agents will offer different levels of management, from finding/vetting tenants, to managing repairs and compliance, rent collection, inspections, exit paperwork etc.
It's not that difficult, but if you are very attached to the place it might be easier with an agent. Expect to pay 10-12% of the rent to them.
It's not a get rich quick option and if you're paying a mortgage you won't make much but you keep the asset/investment.
I keep my property pretty tidy and in good repair. Once you've paid all the essentials and maintenance you might come away with half of the rent.
Look realistically at the numbers. You'll need annual gas inspection, 5 yearly electricity, insurance, maintenance both planned and emergency and you pay tax on the income. Plus potentially someone to do your tax return too if you're not sure how to do that. Every now and again you'll need to cover a big expense - boiler, roof, new bathroom, so on.

Have you moved in with your partner yet?
Whatever you do don't give up your asset!
Ring round letting agents, get prices and get an idea of if and how much your house will rent for. Then do the sums to see if it could work. Hopefully it does.

Just to add in my 2 pennies worth. I was an accidental LL about 8 years ago when I had to take the reins over from my late dad after he started succumbing to dementia. Not something I’d ever wanted to get involved in. I have gradually professionalised myself and it is doable, not least thanks to the internet. There is a tendency to over dramatic “ sell now” type responses here, and on forums such as landlordzone when people ponder whether to sell or become a landlord. I suggest you maybe start off with an agent while learning the ropes. As others have said, being a landlord is much more legally controlled and has several potential pitfalls for the uninformed. If you join the NRLA for about £90 pa you will get all the info plus a helpline. You can still get all the info from sites such as landlordzone but DIY ing it from the start could end up being quite stressful. Personally, I’d keep the property for the security it gives you and rent it out via an agent, and consider going it alone/ tenant find only contract with an agent later down the line.

to repeat - it won't be much use as an escape if needed. I can't see that six months notice ever being reduced, and that is only 'notice to legal action'.

times have changed.

Just use a managing agent.

Accept you'll lose 10% rent each month but you'll have no hassle and still have your asset

I say this as a young person who ended up an accidental landlord. I've been one for 3 years now with no issues whatsoever

Dont rent it. Tennant's cause so much problems. Not worth the hassle.

The thing is, the choice I'm making is between keeping the house empty and continuing to pay the mortgage and bills, which I can afford on my salary, while living elsewhere and contributing to household expenses there, or renting the house out and recouping some of the money. I'm trying to work out whether it is worth doing or if the aggro is too much, not whether it will make me a profit in the short term. In fact, even persuading someone to live there rent free and take on the bills would help out a bit as it wouldn't be empty and I wouldn't be so worried. But I don't know anyone who would need it. All my siblings and cousins have their own houses.

Is it in an area where it may let as a holiday let or air bnb instead? That way it may pay its keep in a shorter time period rather than being let out all year?

@SeasonFinale

Is it in an area where it may let as a holiday let or air bnb instead? That way it may pay its keep in a shorter time period rather than being let out all year?

I have thought of that but don't know. The village is a fab place to live but not very 'holiday' ish. Or maybe it is?

It might be worth trying that out this summer when people can move around - might be more people want to go to random villages in the UK.

I bet that has its own challenges though!

@MiscUser9823

Dont rent it. Tennant's cause so much problems. Not worth the hassle.

Considering you cannot even spell I doubt your advice is based on facts

Ouch!

If you sell there's no going back.
Why don't you try renting if the holiday let doesn't sound good.
See it as an experiment. If you don't like letting you can always sell it when contract ends?

You have to want to do it. It has to be more than it’s what will make the numbers add up.

To do it properly takes time and effort and is a responsibility. Tenants pay a lot of money in rent and have paid for a and deserve a professional service. To a point, you can pay an agent 15% + vat for a fully managed service and much will be taken care of. But you will have to expect to be involved in decision making and forking out for expenses you might not choose to pay in somewhere that’s your own home. You’ll have to have the boiler serviced and a gas check and probably repaint every couple of years and expect to replace the kitchen and bathroom more than you would if you were living there. Rented homes get hard use and things being a bit tatty or repairs delayed isn’t acceptable when someone is paying you to sort it out and do it fast.

And a key thing to be aware of is how inflexible renting is. You can’t go from having tenants to marketing the property the next month and cashing the house in speedily. Notice cannot be given until at least 4 months into a contract and then 6 months notice is currently required and you need to know tenants are legally allowed drineemain beyond that until removed by bailiffs if they choose, and that process can take more than a year. Only at that point can you seriously market your property or expect someone to offer and proceed with buying it, because mortgage lenders will not lend on a property until it’s vacant and you can’t exchange. So you’re looking at needing to know you want to sell probably at least 6 months and possibly far far longer in advance than you actually can if you’re renting. So it’s no good becoming an accidental landlord with a view to suddenly stopping and looking to sell and move. That doesn’t work for landlords and tenants have lots of legal rights (rightly so) about notice periods and evictions which mean everything an take ages. So if there’s any chance you’d want to sell within a short timeframe, realise this probably isn’t for you. Not all accidental landlords realise this, then they feel cross that they have to give lengthy notice and that if a tenant doesn’t go that they have to go through proceedings which can taken a year or more.....but these things shouldn’t be a surprise. They should know BEFORE becoming a landlord and only become one if they’re prepared to accept that.

It’s no good if you can’t bear the burden of making losses at certain points either. You might have void periods when you still face costs but there’s no revenue. You might have to pay out for a new boiler which wipes any profit you made that year and then some and means you’ve made a loss. You cannot say to a tenant ‘I can’t afford it’ but it’s your obligation to pay it, even if it means you make losses. So you need a chunk of money behind you for voids or unexpected costs which will undoutdely come.

There can be money to be made, especially if you bought at the right time and the property rises in value while you’re renting and if you’re not heavily mortgaged and so can make a decent profit and also withstand those unexpected costs without instantly making a loss.

Only go into it if you can do it with a strong understanding, willingness and ability to put the time in during the rental when needed, and can bear the financial risks and timescales involved. Otherwise, don’t do it....not just for yourself, but because if you don’t tick all of this list, the experience you’ll give the tenants will be sub-par and that’s not on if they are paying you for a professional service. You must be sure you can provide it.

Thanks WombatChocolate. At this rate, I won't need to go on a training course - there's so much expertise on Mumsnet!

Have you looked into private sector leasing with your local council?

You could also look at air b n b?

You could remain resident but mostly away snd look at letting a room under a licence agreement. Much easier to regain possession.

Also would you need to change your mortgage to buy to let type?