renting whole house to contractors

Iamdave

Does anyone have any experience of this and can offer some advice?

Looking to rent a 3 bed property to contractors for between 5-7 months. Don't need a letting agent as we have contact with 3 interest parties.

Just wondering what we need to have in place prior to them moving in. I've had a contractor rent before but this was a room in my main house and an unwritten agreement as it was only for 7 weeks and a friend of a friend.

with this being a longer term and in our 2nd home just looking for what sort of paperwork we will require and whether it is best to have a written agreement with the renters in place?

thanks

ognum

Iamdave wrote: »

Does anyone have any experience of this and can offer some advice?

Looking to rent a 3 bed property to contractors for between 5-7 months. Don't need a letting agent as we have contact with 3 interest parties.

Just wondering what we need to have in place prior to them moving in. I've had a contractor rent before but this was a room in my main house and an unwritten agreement as it was only for 7 weeks and a friend of a friend.

with this being a longer term and in our 2nd home just looking for what sort of paperwork we will require and whether it is best to have a written agreement with the renters in place?

thanks

Sorry Dave, maybe it's me but I've now read this twice and still don't understand what you are asking!

Iamdave

what paperwork would we need to have in place? i.e. electrical certs.

The things we will need to appease the mortgage company.

and would it be best to have a a formal contract with the 3 renters? Having no experience of renting a whole property before it would be good to know if there is a template contract agreement that can be downloaded....

agrinnall

G_M has done all the hard work for you alredy.

https://forums.moneysavingexpert.com/discussion/5180214

ognum

Iamdave wrote: »

what paperwork would we need to have in place? i.e. electrical certs.

The things we will need to appease the mortgage company.

and would it be best to have a a formal contract with the 3 renters? Having no experience of renting a whole property before it would be good to know if there is a template contract agreement that can be downloaded....

Template contracts are available from most LL associations, join one it is tax deductible.

I am not an expert on this as I only let to single households but I believe if a property has occupiers with three of more separate tenancy agreements it becomes an HMO. Am I right?

pmlindyloo

ognum wrote: »

Template contracts are available from most LL associations, join one it is tax deductible.

I am not an expert on this as I only let to single households but I believe if a property has occupiers with three of more separate tenancy agreements it becomes an HMO. Am I right?

G-M's link covers HMOs.

However, the rules for HMOs and council tax liability are different.

See here:

http://www.brighton-hove.gov.uk/content/council-tax-and-benefits/council-tax/council-tax-and-houses-multiple-occupation-hmos

With 3 non related tenants the property will be classed as a HMO for council tax purposes.

Generally, if there is a joint tenancy agreement then the tenants are liable for the council tax.

However, if there are separate tenancy agreements then the landlord is responsible for the council tax. Usually the individual rents are set to include the cost of the council tax being met by the landlord.

anselld

3 unrelated sharers is an HMO regardless of Council rules.
ie HMO management regulations apply, including electrical certificates.

HMO may or may not be licenseable depending on local Council rules.

HMO would not be HMO for Council tax if the tenancy was Joint and Several. ( but would still be HMO for management and possible licensing)

G_M

I too don't understand: what is the relevance of 'contractors'?

1) Are you letting the property to a company, who will use it for their contractor staff to live in? If so, this is a commercial tenancy, not an AST. Be careful.

2) Or are you letting out individual rooms to indicidual people (who happen to be contractors, but migtht just as well be retail staff, bamk clerks, or doctors)? Sounds like an HMO.

3) or are you letting out the whole property to a group of people on a single "joint and several" tenancy (and again they happen to be contractors but could be ...blah blah..)?

Please clarify the above, as well as the Qs you have.

Tenancies in Eng/Wales: Guides for landlords and tenants

Note that my guides are for ASTs, and are not detailed on HMOs (with which I have little experience)

However, whatever the type of tenancy, you'd be mad not to have a written agreement as well as all other required/recommended documentation.

eddddy

... or are you saying that you will be renting you house to contractors whilst they are working away from home?

I.e. they have their own homes (permanent residences) elsewhere. They might even return home at weekends. So more of a guest house/hostel than a home.

If so, the rules are different. (And arguably your house would become a business premises rather than a private residence - so you would need planning consent for change of use, you'd have to pay business rates, business insurance, and you probably would have to get a commercial mortgage instead of a residential one.)

CIS

... or are you saying that you will be renting you house to contractors whilst they are working away from home?

I.e. they have their own homes (permanent residences) elsewhere. They might even return home at weekends. So more of a guest house/hostel than a home.

This is a key aspect as the location of the 'sole or main residence' of the OP makes a huge difference.

agrinnall

CIS wrote: »

This is a key aspect as the location of the 'sole or main residence' of the OP makes a huge difference.

But we already know that this is the OP's "second home" so we can assume from that that he has a main residence elsewhere, and I'm not sure why the location of that residence has any bearing on any aspect of letting the second property.