Who to consult before letting out your property?
You will need to contact several parties before you can let out your property. One party that you must contact is your mortgage lender who may request your property be let on an Assured Shorthold basis.
The default tenancy for most dwellings in England and Wales is the Assured Shorthold Tenancy agreement. This tenancy agreement gives properties a security of tenure and was introduced in 1988 with the Housing Act of the same year.
Security of tenure
As a landlord, you will have the right to terminate the tenancy by employing the ‘Section 21 Notice’ which can be used to serve a notice period of two months and can be served at any time during the tenancy. The Assured Shorthold Tenancy agreement has no minimum length and can be used at any time.
If the ‘Section 21 Notice’ has been used to start court proceedings, the court is unable to order the tenant to give up possession no earlier than six months from the beginning of the tenancy. If an Assured Shorthold Tenancy follows another Assured Shorthold Tenancy, the tenant has protection for a period of 6 months from the commencement of the first tenancy from when the premises were occupied.
Factors landlords should consider the following:
- The cost of letting the property in question
- Making sure the property is covered in the event of fire, damage or theft
- Informing the insurance company
- Informing the freeholder if you wish to lease the property
- Gathering advice from a qualified letting agent, accountant or solicitor can aid you in these matters
At Homes Direct, we also advise prospective landlords to consider and manage their finances to budget for the costs involved in the letting process. We have devised a list of costs landlords should budget for:
- Fees for insurance companies
- Management and letting agents fees
- Fees for solicitors and insurance companies
- Expenses in decorating and ensuring the property meets the regulatory safety standards for furniture, utilities and appliances
- Provision of furniture and furnishings
- A budget for repairs and maintenance
- Monthly mortgage repayments owed
By planning carefully and ensuring that there are funds available for essential repairs when required will enable you to better serve your tenants.