Common Landlord Mistakes
Becoming a landlord, whether out of choice or necessity can be a very challenging experience.
In order to make the experience as positive as possible, we have listed below the most common mistakes made by landlord and how to avoid them.
Purchasing the wrong property
When purchasing your buy to let property, you must remember that you are purchasing a property as a business venture and purchasing a property in the correct area will maximise your return. Remember to purchase with your head and not your heart.
Not referencing your tenant
Referencing your tenant is a crucial part of the process, as it will provide you with an indication of your tenant’s financial commitments and suitability for the property.
Not using a tenancy agreement
The recommended tenancy agreement is a short assured tenancy agreement with the minimum rental period of 6 months. A landlord who has let their property under a short assured tenancy for the minimum period of 6 months and has served the correct notice on the tenant at both the outset of the tenancy, the correct notice being an AT5 notice, and also at the termination of the tenancy, has an automatic right to regain possession of the property. Failure to serve the correct notices on the tenant can affect the landlords right of repossession. Therefore, it is imperative that the legal documentation is prepared and served correctly.
Obtaining a sufficient deposit from your tenant is vital in order to provide you with the knowledge that you can apply for recovery of any costs relating to damage or unpaid rent. Once you have obtained the deposit you must submit it to an approved tenancy deposit scheme within 30 days of the tenancy starting and also provide the tenant with key information about the tenancy and deposit.
It is in your best interests to carry out periodic property inspections during the tenancy in order to establish whether the property is being cared for to your standard, whether your tenant has any issues and to ascertain whether any repairs are required.
Repairs and Maintenance
It is imperative that you set aside a proportion of the rent received in order to cater for any repairs or maintenance required. You must also ensure that the property meets the Repairing Standard at the start and throughout the tenancy. The Repairing Standard relates to the condition of the property. The property requires to be wind and water tight, fit for human habitation, the structure and exterior need to be in reasonable repair, the installations in the property i.e water, gas and electricity need to be in proper working order and you must ensure that when notified by your tenant of the need for repairs, you carry these out within a reasonable timescale. Should your tenant feel that the repairs are not being carried out within a reasonable timescale they can refer the matter to the Private Rented Housing Panel who have the power to issue a Repairing Standard Enforcement Order to make you do all of the work required to bring the property up to the Repairing Standard.
As a landlord you must keep up to date with legislative changes and apply accordingly.
Ending the tenancy
Tenancies don’t automatically end when the term of the tenancy agreement comes to an end. To end a tenancy agreement, you must follow the correct procedures and issue your tenant with a notice to quit. You don’t have to use a particular form, but for a notice to quit to be valid it must be in writing and must tell your tenants how much notice you’re giving them, that you’ll still need a court order to get your property back if they don’t leave when the notice runs out and that they can get independent advice about the notice – and where they can get that advice from (eg Shelter Scotland). You must also issue your tenants with a ‘Section 33 notice’. For a short assured tenancy, the minimum notice period is 40 days if the tenancy is for 6 months or longer. For a tenancy that is continuing on a month by month basis after the original period has ended, the notice period is a minimum of 28 days. You must give 2 months notice when giving a Section 33 notice. You can issue both the notice to quit and Section 33 notice at the same time.