Renting out!

Spottedleopard

Hello everyone.

My parents died six years ago. They owned five properties (I am living in one, my sisters are living in another) that they used to rent out- but nobody has really been in them since they have died apart from the odd couple of times a year when family have stayed and friends have visited from abroad.

The properties: there are three of them, all in the London area

One in Notting hill (5 bedroom, 3 bath- one bedroom is ensuite) It needs a new kitchen and probably one new bathroom fitting otherwise everything else is OK and been fitted in the last 10 years.
P/C: W111QJ.

Second is in Wimbledon (4 bed, 1 bath). Not much works needs doing on the inside probably just a paint freshen up in a couple of rooms but will need to get a gardener in to do the garden.
P/C: SW197HP

Third is in Hampstead (2 bed, 1 bath). Nothing needs doing to it really- again probably a paint freshen up and maybe a new carpet in one of the bedrooms!
P/C: NW3 1QY

I have no idea where to start. Will get people in to do the work, that isn't a problem but its the rest...

*How much should I ask?? We own the properties outright so we aren't paying a mortgage on them. Is there a website calculator I can use to calculate how much I should charge?
*How do I go about finding tenants? Shall I contact an agency- or do it myself? Or advertise on spareroom etc?
*Do I pay utilities or do they and they give me the money with the rent?
*What about things like house insurance etc??
*What is landlord insurance??


There are other things I thought of but can't think of now...Im clueless but it seems stupid just having them sitting there and I can't bring myself to selling them and we could do with the money each month..

Thanks to anyone who can help

ll123_2

*How much should I ask?? We own the properties outright so we aren't paying a mortgage on them. Is there a website calculator I can use to calculate how much I should charge?
Do some research on rental properties in the area and base your prices on similar properties.
*How do I go about finding tenants? Shall I contact an agency- or do it myself? Or advertise on spareroom etc?
Agency fees are expensive but if you find a good one (make sure they are part of an accreditation scheme and have money protection) then they are worth the money. You can use them to just find a tenant or have them manage your property as well. Other sites like upad, zoopla etc.
*Do I pay utilities or do they and they give me the money with the rent?
Easier if you let them deal with utilities as you do not know how much they will use electrics/gas.
*What about things like house insurance etc??
*What is landlord insurance??
Very wise to get landlords insurance, this includes things like public liability in case a tenant has an accident and tries to sue you

There a lot of things you need to consider such as:
Deposits - they need protecting in a scheme
Licensing - some councils require you to have a license, contact the council
EPCs and Gas Safety certificates

There are a lot of things to consider, I suggest reading this forum extensively. I'm a member of the RLA as well https://www.rla.org.uk ... there are others as well (NLA and regional ones).

Hope that helps

Kynthia

You should join a landlord organisation and buy a current book on being a landlord, particularly because you have so many properties and don't want to get it wrong. You will potentially be liable for a lot of tax considering the income you are likely to make and lack of mortgage interest as an allowable expense, therefore I'd recommend you get an accountant to handle the finances at first. They can ensure it's done correctly, help you with all the allowable expenses and to help minimise your tax liability.

dancingfairy

Well I'd say it depends on your own financial situation (and that of any others that have any ownership/say in the properties) but it may not be the best idea to rent them out. You could sell them and invest or spend the money.
Bare in mind that letting is a business and you should treat it as such, unfortunately there is no room for sentimentality in the lettings game because scam tenants will try and appeal to your better nature and also no matter how much you think you can trust someone/have vetted them people can and do trash houses This will be even more distressing to you if it's a previous family house (or has memories).
There are many and varied risks of letting - ie tenants trashing/burning the place to varying degrees. Issues with them not paying rent and refusing to move out, as well tax and legal implications.
I do not have a problem with landlords - it's just that an awful lot of people end up being accidental landlords and don't understand all the legal implications and any risks of being in business.
Best of Luck whichever way you go.
df

PasturesNew

I looked up the potential of the first one .... and when I saw it might be worth £2-3million, I figured that I'd stop looking.

You need to invite some local reputable agents round and get their opinions on what people are looking for and what needs to be done etc.

theartfullodger

Well by giving post code & brief descriptions you've flagged up to squatters and/or thiefs some suitable targets.

You need professional help in being a landlord as well as being prudent in the information you put on a public forum.

Undeserving rich eh?

Cheers!!

franklee

Silly question but you haven't said who owns them now other than "we". Are they all shared with your sisters, what do they want to do with them? If you've no clue why have they nominated you to manage, can they assist? As there is so much money involved getting profession help should not be a problem surely, can you all put into a pot for the start up costs?

Werdnal

You say you cannot bring yourself to sell these properties, which suggests you have a deep emotional attachment to them - never a good combination with thinking of letting!

To learn how to be a LL, there is a good newbie guide here:

http://forums.moneysavingexpert.com/showpost.php?p=41160642&postcount=12

which covers the legal rules and regs. You can managed the properties yourself or get an agent involved - TBH with so many properties and the amount fo rent they will generate, investing in a good agent will be worthwhile for you. However, not all agents are good agents, and they will no doubt be falling over themselves to handle your valuable portfolio, so make sure you choose wisely - agents need no minimum qualifications or experience to set themselves up, and judging by the posts we often get here, many can be just as clueless about letting as you are!

I too would 2nd one of the earlier questions here - how are the houses owned? Are they jointly between you and your siblings? If so, you would all need to declare equal portions of the rental income for tax.

However, I am a little perplexed at your statements about each property not needing much more than a coat of paint to refresh them for the letting market. If as you say, your parents last let these properties before they died 6 years ago, and they have been more or less left empty ever since, they may need a little more updating than you think! Are you planning to let them furnished?

Utilities and council tax are usually the responsibility of the tenant to pay. You put the accounts in their name and give the companies meter readings from the day they move in, and again when they move out. All remaining debt then falls to the tenant. Only exception here would be if you let to students who are council tax exempt, then I believe you would need to cover the CT.

LL insurance is always recommended - normal household buildings insurance will not cover lettings. You also need an EPC, and annual gas safety certificate.

I cannot believe you have kept these properties empty for so long! Are you paying Council Tax, insurance, utilties etc on them at the moment, without getting any income from them in return? I am also very surprised you have not had any problems with squatters or break-ins while they have been vacant.

Spottedleopard

Werdnal wrote: »

You say you cannot bring yourself to sell these properties, which suggests you have a deep emotional attachment to them - never a good combination with thinking of letting!

To learn how to be a LL, there is a good newbie guide here:

http://forums.moneysavingexpert.com/showpost.php?p=41160642&postcount=12

which covers the legal rules and regs. You can managed the properties yourself or get an agent involved - TBH with so many properties and the amount fo rent they will generate, investing in a good agent will be worthwhile for you. However, not all agents are good agents, and they will no doubt be falling over themselves to handle your valuable portfolio, so make sure you choose wisely - agents need no minimum qualifications or experience to set themselves up, and judging by the posts we often get here, many can be just as clueless about letting as you are!

I too would 2nd one of the earlier questions here - how are the houses owned? Are they jointly between you and your siblings? If so, you would all need to declare equal portions of the rental income for tax.

However, I am a little perplexed at your statements about each property not needing much more than a coat of paint to refresh them for the letting market. If as you say, your parents last let these properties before they died 6 years ago, and they have been more or less left empty ever since, they may need a little more updating than you think! Are you planning to let them furnished?

Utilities and council tax are usually the responsibility of the tenant to pay. You put the accounts in their name and give the companies meter readings from the day they move in, and again when they move out. All remaining debt then falls to the tenant. Only exception here would be if you let to students who are council tax exempt, then I believe you would need to cover the CT.

LL insurance is always recommended - normal household buildings insurance will not cover lettings. You also need an EPC, and annual gas safety certificate.

I cannot believe you have kept these properties empty for so long! Are you paying Council Tax, insurance, utilties etc on them at the moment, without getting any income from them in return? I am also very surprised you have not had any problems with squatters or break-ins while they have been vacant.

You see, thats the joys of high security alarm systems and CCTV- you don't get as many break ins

theartfullodger

Spottedleopard wrote: »

You see, thats the joys of high security alarm systems and CCTV- you don't get as many break ins

Now there's a challenge to the lads - descriptions, post-codes and advice on what security systems are allegedly fitted.. are you for real or is this a wind-up??

Cheers!

Werdnal

theartfullodger wrote: »

Now there's a challenge to the lads - descriptions, post-codes and advice on what security systems are allegedly fitted.. are you for real or is this a wind-up??

Cheers!

Agreed Artful, there's the clueless and the downright "asking for it" stupid!

TBH I am pretty pee'd off that OP took it upon themselves to come back with a petty quip, yet didn't have the decency to thank me or any of the other posters for their advice and replies!