Many of us have changed career, and even industry, in the last year. The pandemic disrupted the UK’s workforce and left many workers unemployed, furloughed or working from home.
If you are thinking of becoming a landlord, there are a few things you need to consider. You need to research the rules and regulations and whether you are even permitted to let your home.
If you are a leaseholder, you need to check if you’re allowed to sublet your property. Here are some tips on how to rent out your home this year.
How much should you charge for rent?
If you are letting rooms in your home, you are classified as a ‘resident landlord.’ It’s your responsibility to keep the property in good condition and set the agreed rent rate. You can also earn up to £7,500 tax-free rent per year from the Rent a Room Scheme.
Of course, before you can earn money, you need to determine a set rental rate. Check out Rightmove and Zoopla to see what other landlords are charging for properties similar to yours. Look at similar areas and make sure to include the number of bedrooms and bathrooms in the property. Try to stick to industry rates so you can stay competitive on the market.
Look at your finances
Experienced landlords recommend keeping a close eye on your cash flow. Calculate your rental income, marketing costs, insurance, mortgage, repairs, maintenance and income tax. You also need to forecast company expenses and your personal living allowance.
Bear in mind that you may need a license to let a property – and this will also cost money. The Selective Licensing Scheme states that some local areas require a landlord to get a license before renting out a property. Check with your local authority as to whether you need a license or not. You will need to meet specific standards to attain this license. These licenses can cost up to £500 every three to five years.
Use a letting agency
If you’re a new landlord, it’s best to hire an agency to help you understand the rules and regulations involved. A local letting agent can help you hit the ground running and start earning money in no time at all.
And finally, ensure the property is clean and habitable
You are responsible for every item in the property. Only include the essential items if you’re offering a furnished property – for example, a fridge, couch, cooker, etc. Your tenants will probably prefer a blank canvas that they can make their own. It’s also handy to mention if you don’t want your tenants to decorate [paint or change the wallpaper].
It’s also your responsibility to make sure all the gas and electric equipment are in good condition. Fit carbon monoxide monitors and smoke detectors to keep your property safe.