Unless you have been living on the moon lately, you cannot fail to have noticed all the anti-landlord sentiment that is around in the media!
Landlords,along with estate agents and bankers, seem to have become Public Enemy No. 1.
This is no doubt down to the minority of landlords – the rogues – who make headlines for all the wrong reasons.
Recent reports have documented 32 people living in a 3 bedroomed house, landlords being fined huge sums for health and safety failures that have endangered tenants’ lives, numerous cases of damp and mould, and, tragically, two people have died in an HMO this month due to carbon monoxide poisoning.
With people ever more reliant on the private rented sector, due to rising property prices, it is inevitable that the spotlight will be on landlords and that the rogue operators will generate the headlines and stir up negative sentiment.
According to recent data, the number of buy to let investors in the UK has hit a record high of 2.5 million in the latest tax year – that’s five per cent up on the previous 12 months.
Around 97% of these landlords will be small landlords with 3 or less properties, and only 3% will be professional landlords with 4 or more properties.
Of the 97%, the vast majority of those will be decent, honest people who have just invested in property to secure their retirement, or leave a legacy for their children. Some may have inherited a property, or moved in with their partner and let out their other home – in other words, they never intended to be a landlord.
Whilst these individuals may be ignorant of law, they generally do not set out to fleece tenants or take advantage of vulnerable people.
In 2018, a landlord has to adhere to over 160 Government statutes and regulations in order to be compliant and provide a safe home for their tenant. The fines for non-compliance are hefty, so it is a business risk not to understand your legal obligations.
While a significant majority of landlords use a lettings agent, it is vital to understand that no one can divest a landlord of their legal responsibilities and the buck will always stop with the landlord. Ignorance can never be an excuse in a court of law.
In view of this, we have put together a short guide on how to be a good landlord:
1. Understand that you are running a business and that you have legal obligations to your tenants.
If you are not clear on what these are, then you should endeavour to learn and/or hand your property over to a lettings agent on a fully managed basis.
2. Repairs and maintenance should be undertaken in a timely manner.
Typically, you should send out a contractor within 48 hours of being notified by the tenant that there is a problem. Responses should become more acute if the tenant is left without heating and/or hot water and if children or elderly people are present in the property.
3. You should understand that tenants are people and that they can experience problems, just like anyone else.
They could lose their job, split up from their partner, have an accident, have some form of crisis, develop mental health problems etc. Life throws curve-balls at all of us, so, if your tenant has a problem which impacts their ability to pay the rent, you should, in the first instance, adopt an empathetic approach and try and find out what the problem is.
It is advisable to try and work with the tenant to assist them to get back on track, such as, if they have lost their job, to assist them in claiming housing benefit and allow them a re-payment plan so that they can pay the arrears once they get back into employment.
4. Communication is everything in tenant and landlord relationships.
Good landlords are respectful of when and how they communicate, giving tenants at least 24 hours notice if they intend to visit the property or send round tradesmen etc.
5. You should ensure that you have all the right insurances for your property.
If it is leasehold, you may only want basic contents and public liability insurance. If the property is freehold, you will almost certainly be required by the terms and conditions of your mortgage to have buildings insurance. It would be a false economy not to have this anyway. You should also have public liability insurance to protect you from third party claims.
6. Good landlords invest money in up-dating and improving their properties.
A property will typically need a face-lift every 7 to 10 years. This could include re-decoration and new carpets.
If a property is left to go into disrepair, the value will drop, the rent achievable will decline, it will experience more void periods, and it may even fall foul of health and safety legislation, where the maximum fine is £30K.
7. Good landlords join a landlord association that can assist them in staying in the loop about ever-changing legislation and also offer support, training, and advice.
The two main landlord associations are the Residential Landlords Association (RLA) and the National Landlord Association (NLA), although there are also more local and regional associations.
8. Good landlords who cannot self-manage choose an agent who will treat their tenants in a compliant and respectful manner.
They will look for membership of an ombudsman scheme (which is mandatory for all agents), along with voluntary membership of a professional body such as the Association of Residential Lettings Agents or the National Approved Lettings Scheme.
Northwood Northampton are fully compliant, with regular training to ensure they are up-to-date with changing legislation, and we also have our own legal department to support any landlords who get into difficulty.
Please get in touch with us if we can assist you in any way with your property journey, the contact number is 01604607080.