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Landlords Guide

 

Is Letting for you?

Are you an investor with a portfolio or just thinking of buy to let as an investment opportunity for pension or regular investment income? Are you a homeowner that is unable to sell or leaving the area but wish to keep a foothold in the local market? Have you inherited a property? If so, do you want to have your home occupied, earning money and be professionally looked after?

There is a shortage of quality letting properties all over the United Kingdom. The recent changes in legislation and a keen demand has fuelled an expansion in the private rental sector which offers an appealing and cost effective option for both landlords and tenants.

Why use Castles?

Castles Letting & Property Management is a friendly, independent, highly focused, company.  We are open 7 days a week with knowledgeable local staff who know what helps to let a property and advice about the required compliance and safety regulations.

We are proud to be accredited members of the Tenancy Deposit Scheme (TDS), The Association of Residential Letting Agents (ARLA) Propertymark and The Property Ombudsman (TPO). This means that we are accountable for our service levels and our systems are regulated giving you complete peace of mind.

Propertymark offers consistently high standards, holding their members accountable in order to protect consumers and their money. Consumers know that the Propertymark Protected logo guarantees that they and their money are safe.

Propertymark expect far higher standards than the law demands and they campaign for more laws and enforcement to regulate the sector. Estate agents, letting agents, auctioneers and valuers who display the ‘Propertymark Protected’ logo actively ensure maximum protection for their clients. By using a Propertymark Protected agent, you have the peace of mind that you and your money are safeguarded by Propertymark’s Client Money Protection (CMP) scheme*.

Using Castles lettings, you can be confident that we will guide you on your property journey, whether you are buying, selling, renting or letting, working to the highest standards and looking out for you and your money.

*The Client Money Protection (CMP) Scheme is a compensation scheme run by Propertymark

Presentation of the Property

The presentation of a property has a direct impact on the marketability and the maximum level of rental income that can be achieved; therefore we recommend that the property is left in the best possible condition before letting.

  • The property should be thoroughly cleaned to a professional standard, or by a professional cleaning company. The carpets should be steam cleaned professionally, and a receipt retained.
  • The garden should be left in a neat and tidy condition, and any outstanding repairs should be attended to.

Our experienced team can advise you on any aspect of decoration works that may be necessary, and can recommend contractors if required.


Our Service

Full Management Service

This is the most comprehensive service and Castles will deal with all the issues of property management required on a daily basis. We will collect the rent and carry out property inspections on a regular basis. Payment for any expenditure will be deducted from rents collected. We relieve you of the commitment of being a full -time Landlord.
 

This service includes:

  • A rental appraisal of the property including advice on maximising the rental value and marketability.
  • Advertising and marketing, and carrying out accompanied viewings.
  • Referencing Tenants through a reputable credit referencing agency.
  • Preparing the Tenancy Agreement and relevant Notices.
  • Arranging for the preparation of an Inventory and/or Schedule of Condition.
  • Taking a Security Deposit from the Tenant at the commencement of the Tenancy and holding it for the duration of the Tenancy in a nominated client account, and in accordance with the Tenancy Deposit Scheme.
  • Taking the first month's rent payment from the Tenant at the commencement of the Tenancy.
  • Collecting the rent from the Tenant monthly by Standing Order.
  • Informing utility companies (electric, gas, council tax and water) of meter readings if applicable and change of occupation.
  • Carrying out quarterly Property Visits.
  • Coordinating repairs and/or maintenance.
  • Arranging an inventory check-out inspection at the end of the Tenancy.

Tenant Find and Rent Collection Service:

This is designed for Landlords who are happy to take control of all maintenance issues but prefer a third party to deal with all financial matters.

This service includes:

  • All of the above points except for points 10, 11 and 12.

Tenant Find Service:

This is designed for Landlords who want us to find a tenant, reference them and arrange all the paperwork for the start of the tenancy. We will collect the first month's rent and register the deposit. The Landlord will then be responsible for collecting future rent payments and all maintenance issues.

This service includes:

  • All of the above points except points 8, 10, 11 and 12.


Castles will hold all deposits as a stakeholder; register the deposit with the Tenant Deposit Scheme, in line with legislation.

The Process

The first stage of the process of putting a property up to let, is to arrange to meet with a member of our team at the property for a marketing appraisal. At this meeting you will be advised how to maximise the rental value and marketability of the property.  We will also discuss our levels of service in greater detail in order to provide a service that will suit each individual Landlord.

When you wish to proceed with putting your property up to let; we will immediately commence marketing upon your written instructions.  We will accompany all viewings of the property and provide feedback.

Once a Tenant has been found they will be referenced through an independent referencing agency to ensure their credit worthiness. When the referencing has been concluded and if you are satisfied with the Tenant a check-in date can be arranged, and a suitable Tenancy Agreement prepared.

Prior to the Tenant moving in, the property will need to be ready for occupation. The property must be completely cleaned, and all personal effects and furniture removed (unless the property is to be let fully furnished).  The garden should be left neat and tidy and any outstanding repairs attended to.  All appliances should be in working order and instructions provided.  At this stage an independent inventory clerk will have access to the property in order to draw up a full Inventory/Schedule of Condition, and if applicable any safety checks will be carried out, and certificates issued.

On the day of the check-in, we will arrange for the Tenants to meet in our office in order to sign the Tenancy Agreement.  We will collect from them the first month's rent, and the Security Deposit on your behalf, we will hold it in a nominated client account for the duration of the Tenancy and in accordance with the regulations of the Tenancy Deposit Scheme, of which we are members.

We will take meter readings and inform all the utility companies and council tax that the tenants have moved in. The tenants are responsible for telephone/broadband and TV License.

Permissions

If the property is mortgaged permission to rent must be obtained from your lender.  Some lenders will levy a charge for property letting and may impose a surcharge on the rate of interest.

You must also obtain permission from the superior Landlord if the property is leasehold, and you will continue to pay any ground rent or service charges relating to the property.  We will require a copy of the head lease if there are any covenants that are applicable to the tenancy agreement.

The property must have adequate buildings and fixture and fittings insurance and your insurers must be notified that the property is to be rented out.

Right to Rent

Landlords Right to Rent which now requires landlords or agents to check ID of all prospective adult occupiers, was initially rolled out in parts of the West Midlands on 1 December 2014 and across the rest of England on 1 February 2016. Where an adult occupier has a time limited right to remain, landlords and letting agents will need to conduct follow up checks. These need to be made 12 months from the initial check or at the expiry of the individual’s right to be in the UK, whichever is the later.

The Home Office announced on 2 November 2016 that the date for new offences under Immigration Act 2016, relevant to the private rented sector in England, will come into force from 1 December 2016. The new measures follow the introduction of civil penalties created under Immigration Act 2014 and aim to make it easier for private landlords to evict illegal migrant tenants, create new criminal offences for rogue landlords and agents who knowingly, or with reasonable cause to believe, let to illegal migrants. The offences are part of wider Government measures to tackle illegal immigration, and protect public services and access to the private rented sector for lawful residents.

The key points under Right to Rent

From 1 December, landlords could be charged with a criminal offence if they know, or have reasonable cause to believe, that they are letting to an illegal migrant.

From 1 December landlords will be able to obtain a notice from the Home Office to end tenancies for occupants with no Right to Rent.

The vast majority of landlords who are found to be renting to illegal migrants and who have not carried out Right to Rent checks, where the scheme has been implemented in their area, will be dealt with under the civil penalty regime. The new offences will be targeted at the smaller number of rogue landlords who are intent on flouting the law.

Right to Rent Checklist:

  • Before allowing an adult to rent your property they must have document(s) proving their right to be in the UK. This could include a UK passport, Registration certificate of permanent residence of EEA or an EEA family member Permanent Residence card.
  • You need to ensure the property that the tenant lives in is their only or main home. Proof of this could be showing that they live there most of the time, keep their belongings there or that they are registered to vote at the property.
  • You’ll need to check the person’s right to be in the UK will continue throughout the tenancy. A check at the point of right to be in the UK has expired or after 12 months after tenancy, whichever is later is suitable.
  • Should you discover in a follow up check that your tenant’s right to be in the UK has expired you’ll need to make an official report to the Home Office.

Ensure copies of the documentation are made and record the date.

For further information please refer to the Home Office Guidelines: https://www.gov.uk/government/collections/landlords-immigration-right-to-rent-checks

 

Landlords Tax Implications

If you are a Landlord resident in the UK, you also have a liability to pay income tax on any profit made on the Property. Some expenses are tax deductable, e.g. repairs, agency fees etc.

For further information please refer to the www.gov.uk website by clicking on this link:

https://www.gov.uk/guidance/income-tax-when-you-rent-out-a-property-working-out-your-rental-income

Non Resident Landlord Scheme
If a Landlord is considered by the Inland Revenue to be non-resident in the UK for taxation purposes, we are legally obliged to withhold tax from the net rental income at the basic rate of income tax, and to pay this tax quarterly to the Inland Revenue, unless an exemption certificate is provided to us. A Landlord can apply to the Inland Revenue for an exemption certificate in order for us to pay the rent with no tax deducted - application forms are available from us on request.  Please note that exemption certificates are required by any named person named on the Tenancy Agreement, when living abroad.  Further information can be obtained from the Inland Revenue.

For more information please refer to the www.gov.uk website by clicking on this link:

www.gov.uk/government/publications/non-resident-landlord-application-to-receive-uk-rental-income-without-deduction-of-uk-tax-individuals-nrl1i

Safety Regulations

Please note that the following information is intended only as a brief guide for Landlords and does not in any way constitute a detailed interpretation of any of the complete Regulations which apply to rented properties. (Noncompliance with the Regulations can result in a custodial prison sentence and/or a substantial fine.)

Gas Safety (Installation and Use) Regulations 1998

A Landlord must ensure that all gas appliances and installations at the property remain safe at all times and are checked for safety at least once every 12 months by a Corgi registered engineer, and a Gas Safety Certificate issued.  If a Certificate is not issued, or the property fails the safety check, a Tenant cannot move into, or remain in, the property until the problem has been rectified, and the Certificate issued.

The Furniture & Furnishings (Fire) (Safety) Regulations 1993

These Regulations apply to all upholstery and upholstered furniture supplied by a Landlord, e.g. beds, pillows, headboards, mattresses, cushions, upholstered dining room chairs etc.  All items must carry the appropriate safety label.  Any non-compliance furniture must be removed from the property. (Carpets, curtains, duvets are not covered by the Regulations).

 

Electrical Equipment (Safety) Regulations 1994

These Regulations apply to all Landlords who let accommodation which contains electrical equipment, the requirement is for all electrical equipment to be safe.  There is no mandatory requirement for equipment to be checked by a qualified electrician; however we do recommend annual safety checks of all electrical appliances by a suitably qualified professional.  Where the safe use of the equipment relies upon the user being aware of any particular characteristic, suitable information or instruction booklets should be provided.

The Plugs and Sockets (Safety) Regulations 1994

These Regulations require that any plug, socket or adapter which is intended for domestic use complies with the appropriate current standard (BS1363) or approval alternatives, and that plugs are fitted with a fuse that conforms to the appropriate current standard (BS1362).

Smoke and Carbon Monoxide Alarm (England) Regulations 2015

It is a legal requirement for smoke detectors to be installed on each floor of the Property, which must be hardwired or in older buildings battery operated devices. As from October 2015, it will be a legal requirement to have a Carbon Monoxide Detector installed where there is a fuel device, such as a gas fired boiler or gas fire, or a solid fuel burner. It is the Landlords responsibility to ensure the detectors are in working order at the commencement of a Tenancy.

Legionnaires  Disease - Control of Risk

Under the Approved Code of Practice by the Health & Safety Executive it is a legal requirement for all Landlords to conduct risk assessments for Legionnaire’s disease and to take any appropriate action if required. The Landlord is responsible for the control of the water systems within the premises and the main areas of risk are where bacteria can multiply and increase to dangerous levels, in hot and cold water systems and storage tanks, and can be spread via showers and taps. The Landlord must ensure that the risk from exposure to Legionella from all water systems in the property is controlled by implementing appropriate control measures. Castles can arrange for the appropriate risk assessment report to be carried out on behalf of the Landlord.

 

 

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Living in Australia and was selling a property in Farnham. I was expecting a nightmare, however Castles, and Steve in particular, made the whole process run smoothly and effortlessly from my side. A buyer was found within a day, I received the full asking price, and most importantly, Steve was always available to advise and guide me. Pro-active, responsive and positive. I would highly recommend...

- Billie

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