If you’re looking to create an income from renting or are looking for a way to make money while you are travelling, renting out a house is ideal. While renting may seem easy, especially as there is typically high demand for rental properties, there are lots you need to consider to keep your investment safe and profitable.
If you are considering renting out a house, here is the only checklist you’ll need to make sure you have covered all the essentials that you need to know as a landlord.
Your checklist for renting out a house
It is compulsory for you to fit a functioning smoke alarm on every storey of your property. You will also need to install a carbon monoxide alarm in any room if it has a solid fuel burning appliances, such as a coal or wood fire. You may also choose to have a carbon monoxide alarm if you have gas appliances and some rental agencies will make this a stipulation.
Remember, all alarms need to be checked that they are working when the tenants move in.
Gas and electrical safety must be prioritised. Make sure you have a gas safety certificate if you have gas appliances in your property. For any electrical equipment, portable appliance testing is recommended. You need to make sure that all electrical equipment is safe regarding installation and maintenance.
- Deposit protection
Another stipulation is that you need to be able to protect the deposit a tenant pays. This needs to be in a government approved scheme. This does not mean you need to go through a letting agent to rent out your property, just make sure to find a suitable tenancy deposit protection scheme.
- Complete a tax return
If your property provides you with a rental income, then you will need to pay income tax. Make sure to fill in a self-assessment tax return or speak to an accountant to make sure you fulfil your tax obligations.
While buildings insurance is not compulsory for landlords, it may be compulsory under your mortgage agreement. Either way, buildings insurance and landlord’s insurance can be incredibly beneficial for financial protection when renting out a property.
- Energy Performance Certificate
Landlords must be able to show a valid Energy Performance Certificate to all prospective tenants. Failure to do so may result in a penalty from trading standards. An Energy Inspection is easy to organise; they will also supply a recommendation report to help your property become greener too.
- Contracts and agreements
If you decide to rent your property through a letting agency, then you will need to have an agreement drawn up with them. If you want to rent directly, then it is essential to create an Assured Shorthold Tenancy Agreement. You may also require a Guarantors Agreement too. With this, you will also need proof that your tenants have the right to rent in the UK.
Once an agreement is in place, you will have to utilise a deposit protection scheme and issue a certificate of deposit protection. An inventory complete with images will also be useful to ensure you can rightfully claim for damage at the end of the agreement too.