Those who have privately let out your homes to friends - what are your top tips? Please give me your wisdom!

[greenday]

We are relocating and will be renting our flat to some friends. We trust them and are very comfortable renting out to them, and we are sure they will not 'abuse' their position as friends / tenants.

Still, I thought it wold be good to ask for advice from those of you with experience. I am quite lost about contracts - what's the best way to go about it?

Any other stuff that I should look out for, that you didn't foresee and wished you did with the benefit of hindsight, please do share!

Thank you!!

Hi Greenday - firstly good luck! If I were you I would employ an agent. My step-father rents out his house and got his fingers badly burnt when a tenant was able to contact him directly. She gave one sob story after another, and eventually did a runner. He and my mum now rent out to another family and use an agent, but I have also been present when the tenant phones him directly rather than going via the agent.

To keep a friendship, I wouldn't become personally involved with contracts/money collections etc. Your friendship could be abused.

Agent fees are reasonable. Hindsight - use an agent!

I don't think I would do this, personally.

My middle sister rented a flat from my older sister's DH once. IIRC correctly, they didn;t speak for about 2 years afterwards.

I did this. It was fine! I didn't use an agent - in fact I gave the friend a discount on the market rent reflecting what I was saving by not paying agents fees (not that I'm suggesting you do this, but it meant she had a very good deal so was likely to stay put which suited me fine as I wanted a long term tenant). We are in a university town and I got a standard contract from the university housing office (for about £2.50!) - so we knew it was all legal and everyone knew where they stood. It was a bit awkward when I wanted to sell the house and gave them notice - but not nasty awkward, just a little bit embarrassing. We were always pretty good about doing stuff that needed doing, and we left them totally alone unless they invited us round - I didn't like to 'pop in' unless they thought I was being an interfering landlord!

Hi, thank you for your thoughts. It is worth being informed about all the possible outcomes!

HR34, we are renting out at a rate lower than market rate as well. Although they said that we'd have to stay at our flat (with them) whenever we visited, I personally would not like to, as I'm sure they are saying it our for obligation and I would not want to be an 'interfering landlord' too.

Any more experiences, please do share! thks!

You'd need to be sure your friends have the same housekeeping standards as you! There are some issues which we've found in our renting experience (we're also landlords, using agents, abroad)- basically, we found that IF someone is renting out their family home (being these days unable to sell it and being unwilling to drop the asking price to meet the market!) they tend to be really unrealistic about their expectations. And also, we're just looking to move again as tenants (school catchment thing) and I've been a bit surprised at how- well, grubby the previous tenant has been allowed to leave the property and it still being acceptable to the rental agency, thus, I suppose, the owner.

As you know there's this thing 'wear and tear' and that can cover a vast amount of damage. You probably do need a deposit to call on if, for example, the 'red wine on cream carpet' thing happens, they 'clean it up' but to nowhere near your standards. What happens then? They might regard it- as might you if you'd done it in your own home- as 'one of those things'. You might like a new carpet!

Tbh, my advice would be to use an agent.

Thank you all.

One more question - is there any difference between a tenancy agreement downloaded from the internet and one from the solicitor? Cost-wise, it's probably a lot!

Hi greenday

I rent my flat out to the bloke who we bought our house from which worked out quite nicely. I give him a bit of a discount because although we're not friends we're not strangers either. I know that he will look after it well as his house was looked after well etc. He has been there 3 years now and all is fine.

The only thing I would say is definitely get a contract in place - I used one off the shelf from WHSmith and it looks fine (although I'm not a legal person!). It's an assured shorthold tenancy agreement. I did get a sample one from an agent I went to when tenant was thinking about moving out and they were much of a muchness. If you want to change any of the details then just cross out and change and make sure you both initial.

The only thing now is that I think by law you have to put the deposit in a special account but I'm sure that's easy.

here

Also remembering about when i went around the agents when my tenant was moving out.

A lot of them offered a lot of extra services which I'm sure are unnecessary - at additional cost of course.

A couple of them tried to tell me that by law I needed an electrical safety certificate - which would mean paying them or an electrician lots of extra money - and my research tells me that this isn't true. I think if you have gas you do have to be able to show it's corgi etc.. but can't quite remember.

I used this website quite a lot...

www.landlordexpert.co.uk/page.php?page=myop1

And directgov is useful.

I would recommend doing some reading so that you know what your obligations are, and what theirs are.

Yeh, my FIL passed away last year and we enquired about renting it out from a local estate agent. We were told it is best to rent it empty, as opposed to furnished, as you do need certificates to ensure things are safe. From memory I understand this stretched to 'fire retardant materials' on mattresses, sofas, cushions, dining seats etc, electricity chesks on all appliances (cookers, microwaves, fridge/freezer, electric tin opener, hoover, fires, etc etc), gas checks if applicable (home heating system, gas fire, gas cooker) and you also needed to ensure fire safety equipment (extinguishers, blankets etc) are provided along with use instructions. Basically we were advised to only leave the essential fixtures and fittings (switches, kitchen cupboards and sink, bathroom suite). You will probably need a certificate regarding your wiring - not too sure about plumbing, but I'm sure the above links will give you the advice needed.
Even if you do not intend to use an agent you still could pick their brains! Get one to come round and have a chat, then tell them you'll think about it and get back to them!!!

Have you told your mortgage company and the insurance company and of course the inland revenue ?
I have just recruited 180 staff this summer to work on finding buy to let properties who are not declaring their income so be warned.

TTT, thank you for website recommendations - I found them very useful!

DD - good idea about asking agents. Thanks!