At a glance
- Make sure you’re prepared before you sign up a tenant, and think carefully about your choice.
- You have the right to expect on-time rental payments, make reasonable rent increases, and to claim for damage that goes beyond wear and tear.
- You do not have the right to enter your rental property without the tenants’ permission and notice, or to evict them without due process.
On the whole, tenants are responsible people, who will treat you and your property with respect. Unfortunately, however, there are always going to be some exceptions – a tenant may be unable to pay the rent due to redundancy or relationship breakdown, or you could find yourself in the unfortunate situation of signing up a tenant that does not treat you and your buy-to-let property with any care.
To prevent and manage these situations, this guide will provide you with top tips and summarise your rights as a landlord.
Choose your tenants carefully
This sounds obvious, but it's so important to screen your tenants thoroughly before letting your property out. A good letting agent (preferably one that's registered with the Association of Residential Letting Agents) will be able to help you by checking a prospective tenant's:
- credit rating
- employment status
If you’re going it alone, you’ll definitely want to ask your candidates for written proof of their ability to pay rent and two references, at the least, as well as check their right to rent in the UK. Remember that looks can be deceiving (which also means that someone who doesn’t look like a great tenant at first sight could turn out to be the most diligent and trustworthy!).
Make an inventory
Your first line of defence against tenant damage is a proper inventory of the condition and contents of your buy-to-let property before the tenancy begins. The best way to do this is to pay an independent and competent party to carry out the inspection (your letting agent is unlikely to be considered independent).
You can do it yourself, but if you later need to rely on the inventory in dispute, you'll need to bear in mind that your word (as opposed to an independent party) may not be considered as reliable. Therefore, if you do decide to take care of this yourself, you should look to take dated photos of the property in order to establish the condition prior to let.
Know your rights as a landlord
You've taken all precautions, thoroughly screened your tenant and conducted a meticulous inventory. Yet somehow, against all odds, you've managed to let your flat to an unhygienic, antisocial tenant who has a very 'easy-going' attitude when it comes to paying rent. So, what are your rights?
Payment of rent
- You should aim to have a written tenancy agreement in place, such as an Assured Shorthold Tenancy agreement. This sets out the amount of rent payable and when.
- Try to get your tenant to pay their rent into your account by standing order. That way you can evidence which payments you receive and, more importantly, which payments you don't.
- If your tenant doesn't pay rent for a set period, and no solution is forthcoming, then you have the right to serve your tenant an eviction notice. However, there is a procedure to follow when doing this (see below). You can also attempt to reclaim any unpaid rent.
If you’re letting through an agent, make sure to check the terms and conditions before signing an agreement. Letting agents generally offer two types of service:
- an introduction service, or
- a full property management service.
Check what your agent covers as part of their managed service should your tenant defer payment. Some letting agents offer arrears management, whereby they chase arrears subject to a pre-agreed arrears management process and collect missed payments or arrears as part of their contract with you.
Raising the rent
- You can put up the rent at certain points in a tenancy. This will depend on the specifics of the tenancy agreement – you may have to wait for a fixed term to end before you can make the increase.
- You can't charge what you like, however. The rent has to be justifiable and comparable to similar properties in the area, otherwise the tenant can complain and you could be forced to restore the rent to an acceptable level.
Neglect and damage of the property
- Damage caused by tenants or their visitors is not uncommon. Whether by accident or on purpose, there will always be tenants who cause damage to your rental property and belongings – furniture, carpets, etc. Annoying as this is, landlords tend to pay for the repairs themselves to save hassle.
- Your tenants have a level of responsibility to keep your buy-to-let property clean, in good condition and smoke-free (unless your agreement specifically says otherwise), and will also be expected to complete basic maintenance, e.g. change light bulbs and use the heating system responsibly. While you are responsible for most repairs, if damage is caused by the tenant, then you should be able to claim the repair costs back.
- The tenant is obliged to stick to the terms of the tenancy agreement regarding matters such as the keeping of pets – if damage or maintenance is required because of this, again you can make a deduction from the tenant's damage deposit or ask them to pay for the cost of repair.
- The exception to this is for 'fair wear and tear' such as to carpets or other furnishings – you can't charge the tenant for these.
- Whenever you propose to charge a tenant, make sure you have proof that the damage was caused while the property was occupied by them. You'll want to take photos (and refer back to those from your inventory) and should properly cost the level of damage caused, complete with quotes to back you up if the tenant chooses to dispute the figure.
- If the damage is considered way beyond 'fair wear and tear' and the tenant will not either repair it themselves or pay for the cost of repair, you are within your rights to serve an eviction notice and retain the sum of money from their damage deposit to cover the cost.
- Your last resort is to go through a legal process to ask the tenant to repair the damage at their expense, but that may not be a viable option as costs could escalate. There are specialist tenant eviction services that could help you do this.
What you can't do
- It is illegal for you as a landlord to enter your own property without prior agreement from your tenant. Landlords do have rights to 'reasonable' access to carry out repairs for which they are responsible, but unless it’s an emergency you will always need to get permission from the tenant with at least 24 hours' prior notice. If you don't follow this process you could be prosecuted for harassment. If you are unsure, get advice from your local housing advice centre or Citizens Advice Bureau.
- You can't harass your tenants, as this is a criminal offence.
- You can't just physically chuck your tenants out on the street or 'help' them move. When it comes to evicting problem tenants you have to be careful not to make an illegal eviction, as this can lead to legal action.
How to evict a tenant
In most cases, there are three stages to this process:
- The tenancy agreement should normally specify a notice period that you can give your tenants to vacate the property.
- If the tenants remain in the property at the end of the notice period, you can apply to the courts for a possession order. The Shelter.org website gives more information about how to apply for a possession order.
- If you get the possession order granted and the tenant does not comply, you can apply for an eviction warrant from the county court. The county court will then arrange to send in the bailiffs.
The Direct.gov.uk website has more information on this, as well as useful PDF documents you can download.
What to do about deposit disputes
If you are letting using an Assured Shorthold Tenancy, you are obliged to put your tenant's deposit in a Tenancy Deposit Protection (TDP) scheme. Each TDP scheme offers a free dispute resolution service to help agree how much of the deposit should be given back.
If you want to make a deduction from your tenant's deposit, you must be able to prove that the damage was the tenant's fault. This can be achieved through an independent inventory conducted at the outset and at the end of the tenancy.
You should also be able to back up why you need to deduct the amount – get quotes for any cleaning or repairs needed. You are unlikely to get the result you want if the dispute boils down to your word against the tenant's.
While it’s important to make sure your rights are protected, don’t forget about your buy-to-let mortgage. The right mortgage, with low monthly repayments, would also help protect your income in case of any unexpected tenant-related expenses.
Disclaimer: This information is intended solely to provide guidance and is not financial advice. Moneyfacts will not be liable for any loss arising from your use or reliance on this information. If you are in any doubt, Moneyfacts recommends you obtain independent financial advice.