The little guide to letting

The little guide to letting

TENANT

TENANT ANSWER

What you need to know before letting your property 01. How do I get the highest rent?

02. Should I furnish or not?

03. What is a corporate tenancy?

04. How do I prepare my property for renting?

05. Should I manage the tenancy myself?

06. Break, or no break?

07. What should I do if my tenants stop paying?

08. How do I claim from a deposit?

09. Can I hold the deposit myself?

10. What will letting cost me?

For further advice call Brik on 020 7384 6790

RENT

VOID

01

How do I get the highest rent?

Presentation, pricing, timing and being flexible are the four keys to maximising your rental income. Firstly ensure your property has professional photographs and a floor plan listed on at least the three major internet property portals (Rightmove, Zoopla and Primelocation).

Many letting agents skimp on photography and neglect floor plans all together, so be wary when making your choice. Second, set a reasonable asking rent. Overpricing can lead to

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longer void periods, reducing your effective rental income, so strike the right balance. Timing is also important.

Leave enough time before the property becomes vacant to find a tenant. Two months is a good guide. And note that the highest rents are often achieved during the busy summer season.

Finally, being flexible on furnishing and the tenants you’ll accept will increase interest and support a top price.

02

Should I furnish or not?

Furniture will not normally increase your property value, and insisting on certain items staying may well prevent a tenant from taking your property. On the other hand, refusing to provide the basics could have the same effect. So the golden rule here is to remain flexible to maximise the number of people that your agent can take through your front door. When it comes to marketing however, furnished property always photographs better.

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TENANT

03

What is a corporate tenancy?

A corporate tenancy is where a company is not only paying the rent but is actually the named tenant on the contract. These have always been seen as a safer route as reputable companies tend to pay on time and the quality of the tenant is normally high.

Corporate tenancies are also often agreed for two years with a break at one year, which many landlords prefer.

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04

How do I prepare my property for renting?

Firstly, you’ll need to prove that your property is safe for tenants to live in.

You must have a valid Gas Safety Certificate, this ensures that the gas supply and gas appliances are safe to use. You’re also required to ensure that the electrical system and appliances are in safe working order. You don’t need to have an Electrical Appliance Test (or PAT test) by law, but it’s good practice. Your property and any furniture or furnishings within it during the tenancy must also be ‘fire safe’. This

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includes ensuring fire warnings, alarms, extinguishers and fire blankets (where required) are in place and working. The safest bet here is to have a proper fire safety test carried out by a registered fire safety engineer. Finally, if you have a mortgage on the property you’re likely to require written confirmation that your lender agrees to you letting out the property to ensure your comply with the terms of your loan.

TENANT ANSWER

05

Should I manage the tenancy myself?

This really depends on you. If you feel confident that you will be willing and able to respond to all the tenants requests in a timely fashion, then managing yourself is not a bad choice. However the reason tenancy’s break down is normally due to poor communication between landlord and tenant, so be realistic if you live

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a long way from the property you’re letting, or have a particularly busy lifestyle. A benefit of going managed is gaining access to your agent’s list of contractors who should be vetted, referenced and trusted to do all the jobs that a rushed Google search just wouldn’t be able to provide.

06

Break, or no break?

A break clause allows the tenant and/or landlord to end the tenancy agreement prematurely, typically after six months on a year long tenancy.

As a landlord the decision to accept or reject a break depends on your circumstances and the rent the tenant is offering. The down side with break clauses is that you have no

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guarantee the tenant will remain after the break, so be aware what time of year this could mean you might have to re-market. For this reason it’s best to avoid breaks over the Christmas season. All things being equal our advice is normally to avoid agreeing to a break clause.

07

What should I do if my tenants stop paying?

Seek legal advice immediately as the quicker you act the better. Be aware that while your letting agent should assist you as much as they can, they are unlikely to serve notices on your behalf so choosing a reputable solicitor to act for you should be a priority.

While getting the legal process started quickly is important, so too is keeping communication channels with the

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tenant open. It’s normally far quicker and cheaper to come to an agreement with your tenant than go through with an eviction, so push for this if at all possible without delaying the legal process. Finally don’t be tempted to change the locks or harass the tenant.

These acts can get you in trouble under the Protection from Eviction Act.

08

How do I claim from a deposit?

When the tenant has moved out of the property, you have ten days to make a claim on the deposit. You simply let the tenant and your agent know that you are making a claim, the reason and amount. The tenant will then either agree or disagree. If no agreement can be found after a personal mediation

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process between you and your tenant, you would contact the deposit holding scheme who will then attempt to get an agreement through arbitration.

Once the scheme arbitrator has reviewed all evidence they will make a judgment that will be final and binding on all parties.

TENANT

LANDLORD

09

Can I hold the deposit myself?

Yes, however we always advise landlords not to as it can create tension when it comes to discussing deductions after your tenant has moved out. Regardless of whether the landlord or agent holds the deposit, it must be registered with and protected by one of the three deposit guarantee schemes, namely the government run Deposit Protection Service (DPS) used

by Brik, the Tenancy Deposit Scheme (TDS) or MyDeposits.

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10

What will letting cost me?

Letting agent fees are typically quoted as a percentage of the rent. Making sure you get a fair percentage is important. At Brik we charge 8%+VAT to find a tenant and collect the rent, and 13%+VAT for a fully managed service. Watch out for hidden costs too. Most letting agencies charge landlords anywhere from £150 to £400 for preparing the tenancy agreement on top of the percentage fees (Brik don’t charge anything). Beyond the letting agent fees you will need to obtain an Energy Performance Certificate (EPC) costing £70 to £120 prior to marketing.

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If there is a gas supply in your property you must also have a valid Gas Safety Certificate before your tenant moves in, circa £75. An electrical appliance test (know as a PAT test) is also advisable, again about £75. Next, a professional clean should be carried out before your tenant moves in. Costs vary depending on size anywhere from £100 to £400.

Finally tenants should be ‘checked in’ against an independently drawn up inventory and condition report. Costs vary depending on size from £150 for a flat to £400+ for larger houses.

OTHER AGENTS

FEES (ex VAT)

BRIK

Letting

8%

10%

Full management

13%

15%

Tenancy Agreement

Free

£150 - £400

Administration Fee

Free

Up to £450

PREPARATION COSTS (approx) Energy Performance Certificate (EPC)

£70 - £120

Gas Safety Certificate

£75

Electrical Appliance Test (PAT test)

£75

Professional cleaning

£100 - £400

Inventory and Condition Report.

£150 - £400+

Total

£470 - £1070

Average In SW6

8% +VAT

That’s all folks 8% +VAT letting fee and no other charges.

Call us now for a free rental valuation.

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