Advice please on rent out property in Scotland

[Fuchsiaflipflops]

I purchased a house in Scotland not long ago, the plan was for me, partner and kids to move up from London.

However partner and I have decided to separate last year and this will no longer be our family home. He’s been living there getting the place ready and me and kids living in London with the view to move up but then Covid 19 hit etc.., after we decide to separate he stayed on until he figured out where he wanted to move to.
I own the property, I don’t want to just sell up. As it’s quite a major decision with all going on. So I’m looking at renting it out for a year or two. I suppose I’m just asking is it straightforward to do? I rented out my flat in London years ago with an Estate Agents, but as I understand things are a little different in Scotland. Just looking for advice.
Thanks.

It’s fairly straightforward, use an agent. If you posted area or city people could recommend agents.

Renting in Scotland is pretty similar to England, it's mostly purchasing that differs

Thank you for your speedy replies @Woeismethischristmas and @WaltzingBetty.
I thought I have to register to become a landlord and then complete forms with local council etc..
Ideally if Estate Agents can manage the property that will be a big help as only looking to rent out for 1-2 years.
The house is in KA1 (Ayrshire)
I’ve been worrying about this all night,
Today I will call some estate agents and discuss matters.

Thank you both.

You do have to register with the council as a landlord - it’s an online form and you need some safety certificates and stuff done.

But a letting agency will get them all done for you if you want, so all you’d have to do is the landlord registration.

I rent out a property in KA3 through a letting agent in Stewarton, Stewart Residentials, which I can highly recommend. It’s a small agency run by the owner, Sharon, who is great - very efficient, helpful and approachable.

www.stewart-residential.com/default.aspx?menuID=1

Really, the only paperwork I had to get was my Landlord registration from East Ayrshire Council, and that was not complicated. Other paperwork, certificates etc, Sharon was able to get from the Home Report from when I’d bought the property a couple of years earlier, or she got organised. She manages the property for me, so deals directly with tenant, arranges repairs etc. My first tenant left last August, and Sharon had a new tenant organised to move in the following day.

Yes you’ll need to register as a landlord, as PP stated, and check your property meets the Tolerable Standards and Repairing Standards required. Check smoke, heat and carbon monoxide detectors meet current regs, fire safety certificates on furniture, safety regs on window blinds cords, etc. As you’ll be registered you’ll need to declare your income from the rented property on your tax return (tax avoidance of ‘casual’ landlords seems more commonplace in England in my experience.). Also make yourself aware of tenants rights in Scotland, tenants have more protection than in England - there are no fixed term tenancies any more, etc. Make sure deposits are lodged in a deposit protection scheme. Good letting agents should help you familiarise yourselves with these rules but the responsibility always sits with the landlord.

Sorry for your relationship breakdown, hope you’re doing ok.

Defo use an agent. I’d use a letting agent rather than an estate agent.

Thank you everyone for your advice, it’s much appreciated.

@Seeingadistance, that’s really useful, thank you. I will look them up today. I do worry about how long it it take to actually get a tenant.

@Notjustamum10, yes I need to familiarise myself. I’m doing ok I think, I’ve two little ones that keep me busy (3 & 17 months). It’s just sad that we never got to live in our family home. But if I stayed with ex partner, it would be difficult and that’s not fair on the children. So for now I’ll remain in London near my family and friends. I absolutely love Scotland and would love to move us 3 up there, as I feel it would be a better life but I don’t know anyone/don’t drive (yet) and it feels like a big change to do on my own with littles ones. I know lots of people just get on and go for it, good on them. But I’d struggle I think. But hopefully in a few years you never know...

@I0NA yes, definitely! I’ll use a letting agent. I’m going to get things moving today.

@tabulahrasa, I’ll speak to letting agents and get things started. It feels less daunting now, especially as I only need to complete the registration form online, which will be quick.

Thank you all, I really value your input.

Do you have a mortgage or do you own the property outright? If you’ve got a mortgage you’ll need to check whether or not it’s the kind that will let you rent it out, if it’s not you can’t.

How long it takes to let depends on a number of factors. Some you can’t change like the location. Others you can, like the condition, price and furnished v unfurnished.

A good agent with local knowledge should be able to advise you on all these. But it’s really specific to each area, which is why local is best.

You can look on Rightmove and adjust the search function to include “ let agreed “ . That way you can see what’s available and what’s gone already. I’d set up some alerts then check them every day. Save anything that’s like yours and / or near yours to your favourites.

You can make notes that only you can see - note when they come onto the market ( it’s on the listing ) and when they are let. Make a note if anything is reduced as the old price will disappear.

If you have saved it to your favourites it will stay there even when the listing is removed by the agent ( they usually do this as soon as a let is agreed so they don’t keep getting enquires ) .

Start today and you will soon see a pattern. If you don’t know the area well you need to look up each house on Google maps, so you can check out the location. Otherwise you might not understand why one is cheaper / dearer than another .

Remember it’s better to spend, say £500 doing repairs / redec than have the property on the market for a month longer ( assuming your rent is more than £550 a month ).

You will need to pay tax on the whole rental income , minus costs like repairs, replacement furniture, insurance and agents fees. You can’t deduct improvements, buying furniture for the first time and your mortgage .

Oh aye forgot about mortgage...

We got all the safety stuff done ourselves because at that point we hadn’t picked a letting agency, and figured it was probably cheaper but I just contacted them and basically said, we want to rent out a house but haven’t done it before and they told us exactly what needed doing and offered to arrange everything.

I own the property outright.

I’m going to rent out as part furnished, the main bedroom has a bed and wardrobe etc...
The front room has a sofa, coffee table, tv stand, desk, bookshelves, etc..
Ex partner doesn’t want to move things and says he’s happy to leave for tenants.

I’ve been looking in Rightmove at other properties nearby and how much they are going for, which is helpful.

You may find the agent will ask you to remove the furniture. Tenants have their own normally but not always. Tenants want their own bed in particular. You’ll also need to make sure it meets fire regulations and also be aware that if there is a problem with the furniture you need to replace it if it’s in the inventory. Wear and tear happens quickly. It’s usually easier to go unfurnished.

Letting in Scotland is regulated so make sure your letting agent is qualified.

You need you registration, gas safety, heat detectors etc all in place. LL insurance and be aware that there is no end date on leases anymore in Scotland. A tenant can move in for a month and then give you 28 days notice to leave.

@AC12theletterofthelaw is right, family size properties usually go better unfurnished.

Is your ex going to decorate it before the moves out, or are you hiring a contractor to do that? Because you won’t get good money for a property with tired decoration and a random collection of old furniture that your ex doesn’t want.

I’m making assumptions here of course - apologies if your furniture is all stylish and new and your decor immaculate.

@AC12theletterofthelaw Yes I did notice when looking on Rightmove that the properties were unfurnished. I was renting it with the furniture as it’s all new bought within the last year. But I totally understand about a bed and sofa. I did say to Ex why not try and sell what you’ve bought and take the money. He doesn’t want to do that. It’s difficult for me to sell from here (London). If agents say it’s best to go unfurnished, I’ll contact a charity and see if they will do a clearance. But obviously with Covid I’m not sure if they are doing clearances right now. I know charities around here are not.

@I0NA well he decorated the house, to fresher up paintwork. Not my choice of colours, it’s quite bright in some rooms. So not sure if agents might suggests decorate again with neutral colours.

Today I am just thinking, should I just sell up. It’s unlikely the kids and I will want to live in that house in the future as it should have been our family home. I’m thinking selling up and save up for a fresh start.
I was looking to rent out as an income until I go back to work at the end of next year.
Oh I don’t know, it just seems so major to sell up so abruptly but maybe it’s for the best.
Thank you for your helpful replies. Very much appreciated

If the furniture is newish , good condition and matching / coordinated then it might be ok, see what the agent says.

Neutral colours defo recommended.

It doesn't do any harm to get opinions from some letting agents - it’s free and they will be able to come out to see it within a couple of days.

Then you can do your sums and see if it’s financially worthwhile, after costs and tax.

@I0NA. Yes, I’ve looked at a few agents, I’m going to contact tomorrow and arrange for valuations and rental income advice this coming week, no point waiting. I’ll see what they say about furniture, you’re absolutely right.

I think after a few day I will make my decision and get things moving.

Thank you

Good luck, hopefully you will get some good advice about rents, costs and the local market.

Im sure it’s not easy trying to arrange this when you are 400 miles away in lockdown.

Quick update on things but still no closer to a decision.
Got valuations done in last few days, the Sales valuations came back as I expected. And apparently the house would sell quickly due to the area, near good schools etc.,
The rental is slightly lower, but long term would be good plan, I just need to repaint the whole property and do a couple of other bits and pieces, complete paperwork etc.,,
But I just don’t know what to do.

Sell it and put money in the bank, I couldn’t buy another property in London, but could be a deposit for a place out of London in a year or two.

Or rent it out, for a year or so and see how things go.
By then I will be back back n full time work as youngest will be starting nursery.

Any thoughts?

Have you had some lettings appraisals? Not just sales? It would give you an idea of what needs done - there is legislation now for hard-wired smoke alarms, legionella assessments etc. Plus letting agency management fees of around 10% rental income (unless you self manage but that brings all sorts of risks). Compulsory LL registration, around £500 for tenant finding/referencing, don't forget LL insurance, and your rental income must be at least 125% of mortgage payment. There's taxation too. Higher interest rates on BTL mortgage (provided you meet criteria).

You might not make much after all of that. There's also CGT to pay if you sell in the future.

It's such a minefield- good luck with your decision.

@ProseccoThyme. Yes it is so much to take on board, I’ve had appraisals, got all the figures etc.. I’ve been given suggestions what needs redoing in the house; paintwork, kitchen. So have factored that additional cost in.
But that’s what I’m worried about, after the agents management fee and tax taken out, plus if there are repairs etc..
the income will quite small, but then I’m also thinking long term. In a year or two time, I’d be in a better position financially.
I’m going to give myself a few more days to think it over

@ProseccoThyme forgot to say, there’s no mortgage on the house.

Be really, really careful about what tenants you take on. We got badly burned when we let our place out due to working abroad for a few years. The eviction process took eight months and would have been even longer if it had been for non-payment.

Renting out is not for the faint hearted. I say that as someone who rented out one flat for a few years, which was 2 hours away (yours is much further!) We did it directly, and it may be less of a headache if you use an agent. (I would hope so, but as LL you do remain ultimately responsible.)

Have a look at the various landlord forums, eg Landlord Zone.
It's also illuminating to read posts on MN by people renting a house.

Good luck whatever you decide.

Just a minor point of information - you don’t need hard wired smoke / heat alarms anymore . You can use interlinked lithium ion tamper proof battery alarms.