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Thinking about renting out our house. Advice wanted!

16 replies

Iwantscallops · 06/05/2010 20:34

We need to move, mainly for an extra bedroom so have decided to rent our house out and buy a bigger one. Does anyone have any valuable advice regarding letting your property out. Particularly the tax and troublesome tennant side of things.

Thanks in advance!

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McDreamy · 06/05/2010 20:41

You need to get permission from your mortgage company. Make sure you get references from your tenants. Are you using an agency? If you are they will guide you through all the safety checks you need to have done before the tenants can move in.

They usually inform the tax office so you should automatically get a self assessment tax form, but if not ring them and ask for one, they will catch up with you if you don't. It's not as daunting as it looks. The notes that come with it are very good.

Get Landlords insurance and consider a breakdown plan for things like central heating. We have ours with British Gas. It's not cheap but we have used it and it's nice to be able to get an engineer out straight away for our tenants as they are very good and we don't want to loose them.

Think about what you are prepared to accept. Initially we said no smokers and not pets but we have compromised on the pets.

We have rented out 4 different properties between DH and I (not all at the same time). We currently have one property rented out and we have never had any problems.

blinkinblimey · 06/05/2010 20:47

Some of your questions are answered on this thread:

Pay tax on rental property?

Sorry I don't know how to include a link direct to the thread...

Iwantscallops · 06/05/2010 20:53

Thanks. Building Society is fine with our plans. Breakdown cover sounds like a good idea. We were thinking of using a lettings company who will charge us 10%. They have mentioned that they can 'manage' the house for us. Is that a good idea? Part of me wants them to deal with it but the other part of me says I would like to check the house myself. Also, am I right in thinking we only pay tax on profit we make after we have paid mortgage/repairs/ agents fees, etc?

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Iwantscallops · 06/05/2010 20:55

Just looking at thread now!

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Iwantscallops · 06/05/2010 21:01

Tax question answered - Thanks blinkin.

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McDreamy · 06/05/2010 21:01

Yes that's right. you can take quite a lot off before you get taxed.

We have always used an agent and you do have to pay but for us it made it very easy as until now we have never lived anywhere near the rented property.

WingedVictory · 06/05/2010 21:05

Also decide whether you will be letting furnished or unfurnished. Personally, I would have thought unfurnished was better, as it is more hassle to move your own furniture in and out, so more long-term and harder to do a flit (we, for instance, could NOT move all our bookshelves and beds, and so on, at a whim).

Hohumchops · 06/05/2010 21:10

from tenant pov:

make sure you leave the place in a decent state - as you can't expect them to maintain certain things.

make sure you paint neutral colours everywhere including the woodwork - doorframes, etc. as by the time the tenants leave (if long-ish term) it will be a mess. Best to do it now so will last. Make sure you use sensible paint in the kitchen and bathroom - the stuff that wipes clean!

get the boiler serviced as you don't want to get calls in the middle of the night.

Basically, go through each room and make sure it is idiot proof! Finish all those DIY jobs you've been putting off - think of it as if you were selling it on. If you expect it to be someone's home then make it nice enough to be one. The nicer it is, the more likely it will attract and keep nice tenants.

Consider hard flooring -laminate stuff is really cheap these days - for all floors as the tenants can easily keep it clean and can bring their own rugs. Too many places have cream carpets - stupid.

Garden - make sure you leave it so that it is really easy to maintain and provide a lawnmower if you expect it to be mowed.

All I can think of right now

WingedVictory · 06/05/2010 21:25

I agree about cream carpets. Our LL put cream carpets in the front corridor (and I once saw white carpets in a front hallway). What are these people thinking? Even without a pram, it's just idiotic!

Iwantscallops · 06/05/2010 21:39

I appreciate all of your advice. Was thinking about keeping it furnished but Winged, you have just changed my mind. Hohumchops- thanks for a tenents pov. It's a lovely house and I want future tenants to enjoy living here. I will certainly keep all your points in mind.

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BoffinMum · 06/05/2010 22:05

We have plain walls in Farrow and Ball colours (modern emulsion, not estate emulsion, as the latter doesn't wipe clean), cream paintwork and a looped beige carpet that is wool but resembles sisal. We repaint every 4 years and touch up in between times with Farrow and Ball matchpots (another reason for using that paint rather than a range that might change).

We put in a decent range-style dual fuel Smeg cooker with self-cleaning liners, that is classy and which the tenants like a lot.

Bathroom and WC have laminate floors.

Budget for a new boiler as the old one is bound to go wrong as soon as you're short of cash, and tenants won't wait.

We provide kitchen table and chairs and curtains/blinds but that's it on the furniture front (there are a lot of fitted cupboards, though).

We ended up getting the property fully managed, as it proved to be a false economy doing it ourselves, even though I have a lot of property experience and a black book of contacts.

On moving in day I put nice smelling white supermarket soap by all the sinks, cheap new white hand towels (Tesco) and loo rolls in the bathroom and WC, and a kitchen roll, cheap new tea towel and a small bottle of washing up liquid in the kitchen. I also leave a pint of milk, the makings of a couple of hot drinks, and a packet of biscuits in the kitchen as well. I make sure we vet and meet all tenants and welcome them in on arrival. That makes sure they are more likely to look after the property.

You will probably need some rewiring done in order to pass electrical inspection, but thereafter it only needs doing every five years. Gas inspections need doing annually and should be taken very seriously indeed.

WRT garden, discourage tenants from establishing new beds as these end up needing a lot of upkeep. WRT deposits, charge a double deposit for pets such as cats and dogs as invariably the carpets end up smelling and needing replacing, and all curtains need dry cleaning, and there tends to be a dispute over this.

Best of luck with it all.

BoffinMum · 06/05/2010 22:09

And finally ......

if a couple split up, do not let one half remain in the property and take over the whole responsibility for the tenancy as there is a high risk of someone doing a runner. Just give them notice.

And make sure you have legal expenses insurance.

blinkinblimey · 07/05/2010 22:01

Might be an idea to negotiate with the agents - I managed to get quote down from 10% to 7% just by umming and ahhing a bit - makes a lot of difference over a few years to your profit margin.

Boffinmum you sound like a good landlord!

Iwantscallops · 09/05/2010 19:51

I agree. Boffin, when can I move in?!

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BoffinMum · 09/05/2010 20:08

We Boffs aim to please. Our tenants do hang around and I've only had one do a runner.

WRT the agents, you can often hammer them down if a tenant stays longer than a year, as they haven't had to find replacement tenants. So we organised a contract with a gradually reducing rate the longer the tenant stays. (Does that make sense?)

Flossbert · 10/05/2010 01:44

If you decide to manage it yourself, I'm sure you will find the LandLordZone website really useful at some point. It's worth changing your mortgage to interest-only (if it isn't already) while you're renting the house, although I can't remember the exact details of why that is. Something to do with tax, I expect, that was covered by blinkin's link.

Gosh i thought I might be able to provide some useful info as I used to be a letting agent, but it seems that sleep deprivation had turned my brain to fudge!

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