A few queries from a would be landlord

geek84

Hi folks
I am in the process of purchasing my first BTL property.
I seem to understand the general procedure and responsibilities of a landlord, but just have a few questions which I hope you knowledgeable people out there would kindly be able to help me with.
1. Does the landlord pay any of the bills such as water and council tax rates?
2. Would it better to outsource the tenant referencing just to make sure it is done thoroughly, or can it be done by the landlord himself (just as long as he covers everything)?
3. Would you suggest paying that bit extra a month in order to enrol into a Rent Guarantee Scheme?
4. It take it that landlords need to enter a Tenant Deposit Protection Scheme. As far as I know, there are 4 types of such schemes. Can you suggest the most popular one and why?
Thanks in advance for your responses.

G_M

geek84 wrote: »

Hi folks
I am in the process of purchasing my first BTL property.
I seem to understand the general procedure and responsibilities of a landlord, but just have a few questions which I hope you knowledgeable people out there would kindly be able to help me with.
1. Does the landlord pay any of the bills such as water and council tax rates? Normally no (unless it is an HMO), but it depends what you put in your tenancy agreement. (obviously LL pays during voids!)

2. Would it better to outsource the tenant referencing just to make sure it is done thoroughly, or can it be done by the landlord himself (just as long as he covers everything)?
I prefer to do it myself, but its a matter of choice. Credit checking must be done by an authorised company though. See link.

3. Would you suggest paying that bit extra a month in order to enrol into a Rent Guarantee Scheme?
No. But see link

4. It take it that landlords need to enter a Tenant Deposit Protection Scheme.
Only if they take a deposit. (but you'd be mad not to!)
As far as I know, there are 4 types of such schemes.
2 'types', 4 Providers, 5 schemes
Can you suggest the most popular one and why?
Thanks in advance for your responses.

Read up on the different schemes. See link.

New Landlords (general information for new or prospective landlords)

ch3101

1 - it depends. If you want to charge extra for you paying all bills so that whoever lives there doesn't have to bother then you can, it would also save changing the utilities to different names every time you change tenant.
When the property is empty you don't have to pay council tax.

2 - a lot of agencies do a finding service where they will find good tenants for you and do all relevant checks, but then you don't need to have them manage the property.

3 - I was checking this out recently and found rent guarantee insurance for £75 a year, that seems worth it to me and of course if jibe mortgage on the BTL is a reasonable size, you don't want to have to cover it from your own salary.

4 - yes, take a deposit, I think the max is 2 months?
Make sure you do an inventory and if something is broken/dirty take ka reasonable fee from the deposit, just don't charge like £50 for a lightbulb etc

Best of luck

G_M

ch3101 wrote: »

1 - it depends. If you want to charge extra for you paying all bills so that whoever lives there doesn't have to bother then you can, it would also save changing the utilities to different names every time you change tenant. This ignores the (very great) risk of the tenants running up huge utility charges.
When the property is empty you don't have to pay council tax.
New rules since April 2013 - check your local council!

2 - a lot of agencies do a finding service where they will find good tenants for you and do all relevant checks, but then you don't need to have them manage the property. True. Or agent tenant-find but DIY tenant checks. Or add in tenancy agreement &/or inventory. Or depsoit protection. Or any other combination. Landlord is the customer and asks for what service(s) he wants!

3 - I was checking this out recently and found rent guarantee insurance for £75 a year, that seems worth it to me and of course if jibe mortgage on the BTL is a reasonable size, you don't want to have to cover it from your own salary.
1) OP asked about rent guarantee schemes. These are not the same as rent guarantee insurance. However, in going with insurance, read the small print to ensure a) you understand the tenant-qualification conditions and b)the exclusions(eg 1st 2 months, and maximum months pay out. Personally I think the premium is usually not worth the remote possibility of a valid (and limited) claim.

4 - yes, take a deposit, I think the max is 2 months?
Yes. Over 2months can be definedas a'Premium'and give the tenant extra rights
Make sure you do a full and detailed inventory and if something is broken/dirty take ka reasonable fee from the deposit, just don't charge like £50 for a lightbulb etc

Best of luck

You can not just 'charge a reasonable fee'. You have to justify the fee. That means getting quotes, allowing for betterment etc.

geek84

Thanks for your replies, everyone.

CIS

When the property is empty you don't have to pay council tax.

It depends on the circumstances regarding the property - each local authority is different.

1. Does the landlord pay any of the bills such as water and council tax rates?

Usually the occupier of the property is responsible for paying however there are certain set cases in law where the landlord is responsible for payment even if the property is occupied.

geek84

Good Morning Folks

Many thanks indeed for all your advice so far. However, I have a few more queries which I would be grateful if you kind folk could help me on 1. I will pay for building insurance. How do I work out the rebuilding costs of the property?
2. What is the best type of (or most popular) tenant agreement that I should have?
3. I presume it is better for both parties to sign the agreement before handing over the keys to the tenants?
4. Are Housing Benefit tenants generally 'ok' with rent payments or are they a hassle?
5. How much deposit should I ask for?
6. Is it essential that I register the deposit with a Tenant Deposit Scheme? What happens if I don't?
7. Can I just take the deposit in cash and write out a manual receipt for the tenants? (I could use the cash straight away)
8. I am thinking of taking the rent money in cash, so that I can immediately use it! I will probably give them a rent book where I can confirm the rent received Does that sound ok or do you think it is better to have the rent paid direct to my account?
9. Once tenants have move in, I am thinking of visiting the property every now and again just to see everything is ok. When visiting, is it best to ignore going into bedrooms or is it worth a quick glance just to see if everything is ok? How often should I visit?
10. I don't want any pets in my property. Does that sound reasonable?
11. Shall I let the tenants decorate the property as they like? I don't want any 'silly' colours i.e. painting walls pink with white spots!!
12. Finally, shall I let them hang pictures etc on the walls? It will ruin the walls i.e. making holes.

I know the above list is (very) long, but I would be most grateful if you kind folks out there could offer some advice.

Werdnal

Geek, your posting history comfuses me, as some time ago you had a long thread running about problems getting tenants to leave. Now you are claiming to be a first time/newbie landlord and asking very basic questions which you should already know the answers to, if your previous posts (and helpful replies you were given to them) were true.

There is a mammoth first time LL post here:

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

which you have probably been linked to before, and will answer many of the questions and basic info you need. Sit down with a coffee, and have a good read through this AND every link within it. Many of these things you should already know, if as you claim previously you have let property before.

Once you have read it, if you still have specific questions, then ask them again, but I am sure if you can be bothered to read, learn and inwardly digest everything GM has included in his helpful guide, you will have very few questions remaining.

I cannot get my head around whether you are not grasping information you have been given before, like the attention of asking all these questions over and over or are a troll. I am sure there are members like me only too willing to answer your questions, but something doesn't ring quite true about some of your posts.

I am searching for your previous posts, both here and on LLZ about your previous tenant eviction problems, and will link them here when I find them.


PS

Here's one for starters:

http://www.landlordzone.co.uk/forums/showthread.php?51548-Tenant-not-paying-rent-and-not-answering-any-of-my-calls-please-advice&highlight=geek84

I'll keep going, but other members will get my drift!

Oh look, heres the same post you had running simultaneously on MSE:

https://forums.moneysavingexpert.com/discussion/4387935

Then you posted here about BTL and DIY:

https://forums.moneysavingexpert.com/discussion/4334327

back in December, then an identical post in February:

https://forums.moneysavingexpert.com/discussion/4463883

Do you bother to read replies you have been given and take onboard the advice.

Are you really intending to invest in property? Have you really been a LL before?

geek84

Good Morning Werdnal

Yes I have previously posted regarding tenant eviction. The property belongs to my uncle and just for the sake of simplicity, I stated it was mine. It was the info that I was really after.

I'm terribly sorry if I have upset you or anyboy else on this thread.

Werdnal

You haven't upset anyone, but you have posted a lot of threads recently covering similar aspects of letting, and you HAVE been linked to the GM LL post in some previous replies.

Asking new questions every time something else you don't understand about letting comes up is not really a good way to research it ... you need to understand the whole picture from start to end, and can sometimes give the impression that members are wasting their time replying to you when you have been given access to this information before.

Read the link, and all the links within it and if you are still confused or do not understand something, by all means ask again, but I am sure the majority of the answers you need are in that linked post - which is why GM had the foresight and initiative to put it all in one handy package for newbies like you to benefit from!

Guest101

geek84 wrote: »

Good Morning Folks

Many thanks indeed for all your advice so far. However, I have a few more queries which I would be grateful if you kind folk could help me on 1. I will pay for building insurance. How do I work out the rebuilding costs of the property? Get a surveyor to valu eit
2. What is the best type of (or most popular) tenant agreement that I should have? what do you mean, length wise: 6 or 12 months are most common
3. I presume it is better for both parties to sign the agreement before handing over the keys to the tenants? in general yes, if practical. If agents doing on your behalf they may get tenants to sign first, send to you to sign and then send a copy to tenants.
4. Are Housing Benefit tenants generally 'ok' with rent payments or are they a hassle? Entirely dependant on the person
5. How much deposit should I ask for? 1 month + 100 is common
6. Is it essential that I register the deposit with a Tenant Deposit Scheme? What happens if I don't? u must, its the law. u can be sued for upto 3x the value of the deposit and you will not being able to evict
7. Can I just take the deposit in cash and write out a manual receipt for the tenants? (I could use the cash straight away) yes, but you cant use the deposit, its the tenants money
8. I am thinking of taking the rent money in cash, so that I can immediately use it! I will probably give them a rent book where I can confirm the rent received Does that sound ok or do you think it is better to have the rent paid direct to my account? yes thats fine
9. Once tenants have move in, I am thinking of visiting the property every now and again just to see everything is ok. When visiting, is it best to ignore going into bedrooms or is it worth a quick glance just to see if everything is ok? How often should I visit? If the tenenats allow u to visit, i would say you glance in the bedrooms. Bathroom, kitchen and lving room is what your looking at really though. But never ever let yourself in, always give them notice and make sure it is ok by your tenants for you to come round, Once the tenants move in, its not your house anymore so do not treat it as such. Harassment is a serious thing, so always try to maintain good relations.
10. I don't want any pets in my property. Does that sound reasonable? yes
11. Shall I let the tenants decorate the property as they like? I don't want any 'silly' colours i.e. painting walls pink with white spots!! you can, but in general its best to say not to in the tenancy, unless agreed, then if they want to they can ask you and you can decide
12. Finally, shall I let them hang pictures etc on the walls? It will ruin the walls i.e. making holes. same as above, but depends on who's renting, some may not bother (students etc) whilst families may want to make a home and want pictures up

I know the above list is (very) long, but I would be most grateful if you kind folks out there could offer some advice.

Please see in red above