Anyone rented their house out ? If so what pitfalls should I be aware of ?

[mousemole]

renting house out for a year. Got a potential tennant. What are the risks/pitfalls I need to be aware of from the agent or the tennant ? Any tips relaly appreciated !

Don't expect the agent to do much
Do expect to have to re-decorate at the end of the year....I know most tennents are good, but best to be prepared for the worst.

Try to emotionally detatch from the fact it is your home and try to see it an a comercial venture

be specific, I wasn't I didn't mind that my first tennant was a smoker with a dog.
She didn't clean the windows once in a year and I could write my name in tar/cigarette gunk on each of the windows.
Even with professional cleaning the next tennant still mentioned finding dog hairs in the carpet.

Make it clear if you want them to mow the lawn, don't just say treat it as your own, their standards may be different to yours.

The agent I used was crap. I now do it myself.

Good luck!

agree with mb. especially regarding the agent ime they get money for nothing! Is the agent ARLA registered?

Don't leave anything you value, make sure you have a gas certificate and electrical inspection done, rental insurance often doesn't cover accidental damage,so hold a good deposit just in case of a moonlight flit or damage. Keep a record of incomings and outgoings some of which you can offset aginst any taxable "profit". Put your own phone no. into suspension if you plan to move back yourself at any point. Notify Council Tax, utliites etc and get readings done.

remember and keep a note of all expenses etc for tax purposes, you may need to do a tax return.

Well making sure a tenant will pay is the main one..we let through an agent to give ourselves peace of mind on this one.

If you want a non smoking tenant make this very clear from the outset. We advertised our flat as non-smoking but found out after some months the tenant was smoking in it..as he was a good tenant in every other way we let him stay.

Most agents offer two payment options..one is commission based on them finding a tenant and collecting the money every month. The other is paying a higher commission for the agent to take care of things that go wrong such as plumbing problems. If you are living near probably better to take care of the maintenance side yourself.

Before letting the house you will need to have gas and electrical checks..we also set up a four star gas cover contract so that British gas would come out if anything went wrong with the boiler.

If you are going through an agent they should set up a contract between you and the tenant incorporating the letting period and notice they have to give.

Katebee the last tennant I had through an agent left owing 4 months rent. having an agent doesn't automatically guarentee they will pay

jingleyjen similiar thing happened to us. they left without paying the last months rent (which was effectively their deposit) but they left such a mess that we were left out of pocket, and they didn't leave the agents a real forwarding address so they couldn't be followed up.

Jingleyjen..really sorry to hear of your tenant who didn't pay. I suppose what I should have said is that using an agent might increase the chances of getting a good tenant as they can check employment, and salary and would have more experience in taking action in the event of non payment.

However, we were probably very lucky that our tenant stayed over 5 years and always paid. We have now sold the property so there are probably other people here who can give more up to date advice.

jingleyjen, same here. We let through an agent and still ended up with a rubbish tenant who didnt pay. TBH we were pretty unimpressed with the agent. Once things started going wrong, the agent was useless.

the agent called me each month with a very reasonable reason why she hadn't paid that month, (she worked in the shop next to their office) on the third month I said enough was enough and they said I had to give her a months notice. I checked and this wasn't true but by the time we had finished arguing about it she left after 4 months of non payment, they said they had no intention of chasing her for the money I should do it myself through the small claims court.

ooh ladies some very good tips here, keep them coming ! Yes, the agent is Arla registered. So, I need to get specific rental insuance ? Anyone know who is best for this ? Also, what deposit it the norm ? 1 month,2 months ? One potential renter has 2 dogs - do you think I should avoid him ? I have 2 very young ones and dont really want to come back to a hairy house !

Personally I'd avoid dogs if you are not a doggy household. Otherwise at least specify a deep clean afterwards and/or leave no soft furnishings.

I think it depends on the tenants. Is there any way you could meet them. We rent privately. The original add stated quite clearly that the landlord didn't want pets. However, we explained that we have a cat, a dog, and a rabbit. The cat and dog are getting on in age and have never done any damage in our homes. The landlord was happy and we moved in. We gave him a list of all the usual people that are generally used for references (current and previous employers; current & previous landlords; bank; etc) and he admitted recently that he never even checked them out as he had a 'good feling' about us (although i wouldn't recommend that approach). We've been here for almost 3 years, the house is immaculate (in fact the landlord has said that it is the best that it has ever looked) and the animals are not a problem.

We have a 5 year old, but having seen the state that friends of ours with three under 5's have left their privately rented house in - I would be very wary of having tenants with children, rather than those with animals.

Everything that everyone else has said. Agents can be WORSE than useless, but if you join the National Landlordss Association or Residentual LA you can get good advice. The contract must be watertight - they have good examples you can download - agents charge for theirs and ones I have seen pretty dire. If you let for 12 months you and the tenant should both pay stamp duty - agents normally do not know this, so an agreement of 11 months with 6 months break clause is better as avoids the cost to both (when we had to evict a tenant the judge tld me he could have thrown it out of court because it had not been stamped - the agents did not have a clue about this.)
Get two months deposit, not one, as tenants often think they can get away with not paying the last months rent as it is covered by teh deposit, even though the agreement wil make it clear it is not. Get an insurance backed deposit scheme, or you will be wrangling for ever over the cleaning bill at the end. Beware of DSS tenants. They are lovely people, but if they are claiming HB fraudulently YOU will be liable. Use the Letsure or similar vetting procedure - this will ensure tenants are who they say thy are , and that they do not have ccjs etc against them - if a propsective tenant has a ccj - do NOT accept them, however plausible...
We let to local teachers, at less than the market rate - we get reliable solvent repsonsible tenants who stay for a long time , they get a better deal than they could get elsewhere. The money we save on agents fees goes to reducing the rent.

If you are accepting tenants with dogs make a post tenancy deep clean at their cost part of the contract. I would also specify window cleaning in the contract.

Agree you need ARLA agents, to distance yourself from it, never accept any excuses for non-payment of rent, ask agents how they check references (they are easy to forge), do not leave anything you care about. Remember there will still be costs. I bank on 48 weeks of income, minus agents' fees and costs when working out how much I am likely to have.

You will need to do a tax return. It is easy. Just keep all paperwork.

I use Letsure for my insurance, and you can also get an insurance with them that covers you if the tenant doesn't pay up. Their website is here www.letsure.co.uk

You must ensure that the deposit from the tenant is put into one of the new deposit schemes, and that you've told you mortgage provider what you are doing and that you have their permission to let.

My agent advised me not to leave any white goods, so I didn't (I needed them in Belgium) and to let unfurnished. My house has been let for 18 months and so far, so good.

I go back once a year to see the house and see what needs to be done to it and feel sad that I don't live there, but I know I'll be going back one day.

You can write off mortgage interest, the insurance, the agents bills, some repairs, the electrical and gas checks, and if you pay thectax and the water rates you can do those as well, against any income from the property. The ideal is to have less in rent than you pay out, so you pay no tax. My mortgage is paid irrespective of the rental income,(don't need the rent for the mortgage) so I make a loss on paper, and have enough money available to do things to the house. You'll need to fill in a tax return each year, and if you are going abroad you need a certificate from the non-resident office to say that your rent can be paid gross (you pay any tax due when you put your tax return in).

Hope that helps!

Also, get a really good inventory done with photos to show the state of the property.

Scaryteacher really useful tips thank you and also everyone else. SO useful to find out other peoples experiences and learn from them. I didn't know so many things that you have all highlighted which is great. Keep the tips and stories coming though, warts and all ! I am now OFF the dogs idea !

Check out some of the letting for landlord sites and they will have good checklists. Also I never put any faith in agents after hearing horror stories. I mean they just want someone in the house but it's not their home IYSWIM so I don't think they are too fussy.

I am in Scotland and there are various legal documents that need signed regarding 'assured tenancies' and what not.

I got most of my stuff from letonthenet.com

Top 10 Tips for Landlords

So you've got a property and you're ready to rent it out - but you don't want to be stuck with the tenant from hell. We've all heard the story: wouldn't pay the rent, wouldn't move out, trashed the place... Well, there are a few simple precautions you can take to avoid this kind of scenario. Follow our Top 10 Tips and you can let your flat with peace of mind assured.

1. Try to give a pleasant but accurate description of your property without over-exaggerating its best points. Don't describe the kitchen as 'hand-built' if that means you've mended the cupboard door with superglue - the ensuing disappointment will make that flat down the road all the more attractive.

1. If you have existing tenants about to move out strike an agreement with them over the best time for viewings - and let them know when you're bringing a prospective tenant to the property. Remember, it's still their home and if you barge in when they're in the bath, the viewing might not go too well. Ask your tenants to keep the flat clean and tidy during this time - their co-operation will be an invaluable help.

1. Once you have found a tenant be sure to take up their references. Ask for bank, employer, landlord and character references or run a check through a credit agency. Double checking these references can save any amount of future hassle - if you don't have time to do it yourself, use the LetOnTheNet Credit Checking service. In other words, choose your tenant with as much care as they have chosen your flat.

1. Use a tenancy agreement - you can download one free of charge from LetOnTheNet. It lays down exactly what is expected from you as a landlord and from your tenant, offering protection to both parties. One of your obligations is to provide the tenant with a copy of your current Gas Safety Certificate.

1. Do not allow a new tenant to move in before you have a deposit (wait for the cheque to clear) and have established by what method the rent is to be paid and put this mechanism in place.

1. At the commencement of a new tenancy, always fill out an inventory form listing the full contents of the property and make sure your tenant signs it. The condition of each item should be noted on the inventory, which can then be referred to in case of later disputes. LetOnTheNet provides a standard inventory form which you can download and then fill out.

1. Carefully record all your expenditure on the property and take professional advice about which expenses can be set off against tax.

1. Inform the utility companies when a new tenancy begins to prevent yourself from being billed for a tenant's use of water, gas or electricity.

1. Do not let rent arrears build up - act quickly, as soon as a tenant first fails to pay their rent. But remember, your first action should be to talk with your tenant. Find out why payment is late and then decide what course of action to take.

10. Join a landlords' support group such as the Small Landlords Association: they will lobby on your behalf and should keep you up to date with any changes in the law that could affect you as a landlord.

Have not read the whole thread but has anyone mentioned Rent Indemnity insurance ?

Also should tell your mortgage company it is let, and buildings insurance too

Need landlords contents insurance to protect your goods.

Voluptua and Vagina, great info, thank you.
A lot of insurance policies to change and get in place. Interested to read that you can 'suspend' your phone number for a year, that is great.

The rent indemnity I have arranged thru the agent before. It takes about 6 weeks to pay out but well worth it, it has paid out twice for us.

Mortgage rate may go up,in fact with the current climate your mortgage company may not even allow you to let, may want you to take out a buy to let which WILL be a higher interest rate.

Alot of financial implications and none in the landlords favour I'm afraid.