Property Letting & Management

a landlord’s guide

Introduction Welcome to our comprehensive guide to the letting and management of your property and how George F White LLP can deliver the service you need to protect your investment and take care of your tenants. Whilst the lettings market remains unregulated there is a whole maze of legislation governing the letting of residential properties – some obvious such as gas and electricity certificates others not so including asbestos and legionnaires disease. If you have a property to let or are considering a buy-to-let then you need to be certain you do not fall foul of the law – a wilful act or ignorant omission, could land you with a criminal record and/or a hefty fine. You need to have the peace of mind that your agent, whether they manage your property or just find you a tenant, are knowledgeable, transparent and will deliver a service to both you and your tenant to the highest of professional standards We hope that this handbook proves a useful source of reference to our services and experience. For further information please contact your local George F White office. This handbook needs to be read in conjunction with our Terms of Business prior to engaging George F White.

About Us We have offices throughout the North of England covering an area from the Scottish Borders as far south as the Lincolnshire Wolds providing us with a sound base from which to serve the community. In an uncertain world you need confidence that your agent acts in a proper manner. Whilst there are no legal requirements for a lettings or property management agent to act to any mandatory standards, with George F White you can be certain that as one of the leading property agencies in the region we will conform to the highest professional standards. We are members of the Royal Institution of Chartered Surveyors (RICS) and are proud of the fact that we are the largest independent firm of rural surveyors within the region. As members of RICS we are bound by a strict code of conduct which means our practices and client accounting systems are fully regulated which in turn means that we are accountable and your money is both protected and insured. In addition we are also members of The Guild of Professional Estate Agents. Part of our transparent and professional service is to provide full and independent referencing on all tenant applicants which covers their employment status and past rental history as well as the affordability of the rent and credit checks. Many other agents only provide credit checks which are carried out in-house. Our property management and letting team offers a quality service unmatched by other agents. Our services are designed to put the landlord first to protect your investment and your interests and to ensure the successful management of your property. Our fees are open and transparent allowing you to opt for our full tenant find and property managed service or choose from a menu of services which suit your own particular requirements.

Our Goals? Our goals are simple... to protect your investment, maximise your income from your property, to retain you as a client for years to come and take care of your tenants. These goals will be achieved by offering the right advice and delivering the highest quality of customer of service. If there are any issues which you wish to discuss, please contact your local office. Why Let? There are many practical and financial reasons why people choose to let property: Purchasing residential property to let can be a secure and

worthwhile form of investment, with returns rivalling many other kinds of investment. More and more people are turning to investment property as a way of providing for their retirement. We are able to manage portfolios of property giving you one central point of contact for all your investments.

Moving abroad, whether it’s temporary or permanent, has become

increasingly popular and letting your property offers you the opportunity to maintain an income from your property with the option to return at a later date.

Changes in the job market mean more than ever, mobility and

flexibility are important career issues - letting offers a swift solution.

Have you considered Buy to Let? Whilst there are fewer buy-to-let mortgage products on the market, now has arguably never been a better time to invest. With property prices low and a buoyant rental market set to expand even further buy-to-let has the potential to offer a high yield investment for your money and it is probably much easier to do than you think. Provided you have an adequate deposit to put down, or alternatively enough equity in your main home, ‘buy to let’ remains an excellent long term investment providing both income and capital growth despite occasional fluctuations in the housing market. Buy-to-let should always be viewed as a medium to long term investment. There are also some tax advantages in buying to let: you can claim tax relief against items such as the interest on your mortgage, letting agency fees, insurance premiums and upkeep on the property. Choosing a Property The key to success with ‘buy-to-let’ is choosing the right property. If you are buying a property to let choose one that will appeal to the type of people who live in that area. For example, the main tenant market could be made up of busy professionals, single people or couples who may be looking for:

· A two or three bedroom property · Good transport links · Small or no garden

Our staff can tell you about what gaps there are in the rental market and with George F White’s auction department there are lots of potential buy-to-let potential investments. Before you buy, check that the property you are interested in conforms to health and safety regulations. Otherwise you could find yourself needing to replace boilers, gas fires and appliances.

B. Pay as you go services Record of Condition/Inventory We strongly recommend that you have a detailed and robust record of condition/inventory which is agreed by the tenant(s) prior to move in which can be relied upon in the event of any dispute at the end of the tenancy. Using our inventory software we can create a detailed written record of condition supported by photographic evidence. Register Deposit For the tenant find only service we would recommend that landlords register the bond with a Government approved scheme and provide the tenant with certification that this has been done. Alternatively we can register the bond on your behalf and provide certification. Periodic Inspections and Move Out Throughout the period of the tenancy you should inspect your property to ensure its condition; these should be undertaken after the first 3 months and thereafter at 6 monthly intervals. It is also vital that an inspection is carried out prior to the tenant moving out. Remember there is a limited time period after move out should you wish to register any claim for damage done to the property. We can also advise and assist with any issues when your tenant moves out including helping with any dispute. Manage Renovations and Refurbishments Usually after a tenant has left in preparation for a new let a property may need renovating or refurbishment. We can organise this for you using our approved contractors. We do not add any mark up to their invoices but charge an hourly rate for managing the process. Negotiate with Tenants Sometimes a tenant can be your neighbour or you may be too busy or feel ill equipped to talk to your tenant about a whole range of issues. Let us take the strain out of the situation, keeping you at arm’s length from any negotiation whilst keeping you fully informed of any happenings. Rent Collection We will collect rent and chase late payment up to the point where we recommend court action to recover a debt. We can negotiate on your behalf and help arrange stage payments of any arrears. Annual Rent Reviews Tenancy agreements should allow for periodic rent reviews – usually on an annual basis. We can give you a market appraisal, re-inspect the property and negotiate a rent review with your tenant.

Tenant Find vs Property Management Once you have decided to let your property you will need to decide what type of service you would like your agent to provide. Do you want them to simply find you a tenant who you will then look after on a day to day basis? Or would you like your agent to handle the full management of your property? Or would somewhere in between suit your requirements? This is a big decision early on and whichever option you choose your tenant will expect to have someone to call on at any time to deal with any emergencies. So you need to ask yourself four questions: 1. Do you have the flexibility to drop what you are doing e.g. your work, when your tenant calls with an emergency? 2. Do you have a good network of local competent contractors able to carry out any maintenance work? 3. Do you want to deal with any disputes directly with your tenant? 4. Are you up to date with relevant and ever changing legislation? If you think you would struggle to say yes to any of the above questions then property management could be a worthwhile investment for you and your tenant. Below are details of what you can expect from our tenant find service and our full property management service: Our Service We offer a range of services for tenant find and property management:

A. Tenant find only B. Pay as you go services – allowing you to choose which services you

require C. Tenant find only and full property management A. Tenant Find Only Service This service includes: Free market appraisal /rental valuation Circulate property details on our tenant register Production of window cards (space permitting) Advertisement on our website and several leading property portals Arrange viewings Advice on legal compliance including gas, electric, furnishings and

insurance Undertake full and independent reference checks on suitable

tenants – these are checks which are undertaken by an independent third party so we have no influence over them at any stage. They include credit checks, employment checks, previous tenant history and rent affordability

Negotiate tenancy commencement and terms Set up standing order mandate for collection of rent Draft and have tenancy agreement signed by all parties Collect the deposit and provide advice on the holding/registration of

the deposit

surveyor to advise on or oversee a complex repair. We charge an hourly rate for the management of this category of repair and would seek prepayment for the cost of any repairs, again holding the money in our client account until satisfactory completion of the job. For peace of mind we categorise repairs to ensure a transparent and appropriate response for tenants and to give guidance to our contactors on the response we expect. Category A Emergency - Response within 8 hours For example a gas leak, a major pipe burst

Category B Essential - Response within 48 hours For example storm damage to a roof resulting in missing slates, a broken window Category C Non-Essential - Response within 72 hours For example excessive condensation in the bathroom Tenants are provided with an emergency out-of-hours contact number. In the event that contact cannot be made they will be preauthorised to contact an approved contractor directly on the understanding that should the call out not be deemed to be an emergency they will be responsible for any costs. Marketing & Letting Your Property The right tenant is the essential ingredient for successful letting and George F White have the experience to find the appropriate tenant for your property. Not only do we have a constant supply of tenants actively seeking a property but we have established contacts with major local companies and relocation agencies, who have regular requirements for good quality accommodation. We also operate the latest in computer software which automatically matches potential tenants to your property and emails/texts the particulars to them immediately. Our internet coverage is second to none using leading property portals including Rightmove, Globrix, Primelocation, findaproperty and the Guild of Professional Estate Agents in addition to our own website, www.georgefwhite.co.uk. Presenting The Property It is a fact of life, properties that look their best let quicker and achieve higher rents, so it is worth considering the kind of tenant you are trying to attract and decorate accordingly. Whether the property you are letting is your own home or a rental investment, it pays to make sure that the décor is chosen to suit your target market. Your local George F White lettings department will be only too happy to provide further guidance and advice if required, and can also put you in touch with specialist furnishings and interior design service providers if necessary. When decorating an investment property the following guidelines should be followed: · Keep carpets and wall colours neutral · Paint finishes are easiest to maintain. However, wallpaper may be

expected in higher value properties. · Good quality carpets and curtains are important, particularly in

unfurnished properties where they are more visible. · Bathrooms should have good quality fittings and be well lit. · Power showers and fully tiled floors and walls are preferred by most tenants. · There should be ample wardrobe space in the bedrooms. · Corporate tenants will expect a high finish. Wooden floors, low voltage lighting are all commonplace at the top end of the market.

C. Tenant Find and Full Managed Service As per the Tenant Find Only Service plus the following:-

Undertake a record of condition (inventory) on move in An initial inspection of the property after 3 months and thereafter at

6 monthly intervals Undertake a move out inspection Collection of periodic rent payments into our dedicated client

account Monthly statement of all financial transactions Distribution of net funds Be the initial point of contact for the tenant Review rent on a periodic basis Organise safety and regulatory certificates Manage maintenance, repairs and statutory safety checks to the

property, up to the limit of £250.00 plus VAT** We will only use our approved contractors for any repairs or

refurbishments Issue appropriate legal notices to initiate termination of the Tenancy

agreement Pursue rent arrears up to the point of recommending instructing

solicitors/submitting small claims action Full inspection of the property once vacated by a tenant Registration of the deposit with The Tenancy Deposit Scheme Hold the deposit in a non-interest bearing client account in a

manner approved by The Tenancy Deposit Scheme Handling Repairs When we are engaged to fully manage a property our clients can rest assured that we will only use contractors who have passed our stringent checks to ensure that they are fully insured, competent and will deliver a service that you can expect. We have three levels of handling repairs. Level 1 Minor Repairs, i.e. under £250 (excluding VAT) we will engage the most appropriate contractor from our approved list to handle the repair on your behalf. We would not expect them to quote for the work as we have in normal circumstance already agreed a rate. The management of these repairs is included in our management fee and whilst we will make every effort to inform you as the landlord of any repair needed we do ask that we have your pre-authorisation to undertake any repair up to a valuation of £250 (excluding VAT) on your behalf. The cost of the repair will be deducted from your monthly rent roll and we will handle the payment to any contractor. If there are a number of small jobs to be undertaken which collectively would exceed £250 in any one month we reserve the right to ask you to make a prepayment for the cost into our client account to allow for prompt payment of contractors; we would not make any payment to a contractor until the work has been signed off as satisfactory. Level 2 Large Repairs, i.e. £250- £500 (excluding VAT) we would first seek your authorisation before proceeding unless of course we deem the repair to be an emergency and putting either life or property in peril. We would still only use contractors on our approved suppliers list and after consultation with you receive a quotation from the most suited contractor. We charge an hourly rate for the management of this category of repair and would seek prepayment for the cost of any repairs, again holding the money in our client account until satisfactory completion of the job. Level 3 Major Repairs, i.e. over £500 (excluding VAT) we would seek competitive quotations from those contractors on our approved suppliers list and will in conjunction with you appoint the contractor we feel most appropriate. We may seek the advice and/or services of a structural

The Electrical Equipment (Safety) Regulations 1994 The above regulations impose an obligation on the landlord to ensure that all electrical appliances and installations left in a let property are safe. We recommend that all electrical appliances are regularly checked and serviced. Failure to comply with these regulations may jeopardise the health and safety of your tenant and could lead to prosecution with penalties of imprisonment and/or fines up to £5,000. As part of our service we can arrange gas and electrical safety inspections if requested. There are particular requirements for houses in multiple occupancy (HMOs). Energy Performance Certificates (EPCs) Since 1st October 2008 any residential property offered to let must have an EPC. This is prepared by a qualified Domestic Energy Assessor who visits the property and prepares a detailed report which covers such elements as glazing, insulation and heating. The property is then given a rating similar in format to those seen on refrigerators and washing machines. The certificate is designed to give prospective tenants information on the energy efficiency and carbon emissions of the building so that they may compare it to others on the market. We can arrange the EPC and ensure your compliance with the new regulations using a reputable organisation.

Furnishings When deciding whether you should let your property with furniture in it or not there is no right answer and it is a myth that properties with furniture achieve higher rental prices. It might be that you are moving out of a furnished house so it is easier and cheaper to leave the furniture in the house. However, if you are worried about damage to any of your belongings it makes more sense to market it as unfurnished. If you do decide to go down the route of renting the property furnished it is always better not to over-furnish as it can have the effect of making the property seem smaller, and you also want to leave your tenant room to add their own bits and pieces. Also you will need a detailed inventory drawn up (with photos preferably) cataloging the condition of the furniture as it could be useful in any future deposit disputes. The Furniture & Furnishings (Fire Safety) Regulations 1988 (as amended) All upholstered furniture made after 1950 is included within these regulations. The furniture covered by the regulations includes sofas, settees, seat pads, beds, head boards, pillows, arm chairs, scatter cushions, futons, mattresses and bean bags, but not curtains, carpets, bed clothes (including duvets) and mattresses and mattress covers. To comply with the regulations these types of furniture must be fire resistant and in most cases carry a permanent label to this effect. To be ‘Fire Resistant’ most furniture and upholstery must have passed an ‘ignitability test’ specified in the Regulations. If you ask us to let or manage your property you must remove any furniture which does not comply with these Regulations before the tenancy begins. Any replacement furniture you place in the property must comply with the Regulations. There are heavy penalties imposed by these regulations on landlords. The penalties for non-compliant include a maximum of six months’ imprisonment and/or up to a £5,000 fine. You can obtain further guidance on these regulations from your local Trading Standards Office. The Gas Safety (Installation and Use) Regulations 1998 These regulations came into effect on the 31st October 1994 to ensure that gas appliances are properly installed and maintained in a safe condition so as to avoid the risk of carbon monoxide poisoning. It is the responsibility of the landlords of domestic properties that ALL ‘gas appliances’ and ‘gas installation pipework’ under the ownership of the landlord are checked for safety at least once a year by a member of the Gas Safe Register and that accurate records of those safety inspections and any work carried out are recorded. These records must be provided to the tenant. These regulations also apply to new properties. ‘Gas appliances’ - include any fitted gas appliances, for example:

· Central heating system · Gas heaters · Gas fires · Gas cookers

‘Gas Installation Pipework’ includes gas pipe work, valves, regulators and meters. Faulty equipment can lead to death and a conviction of unlawful killing. Under the Regulations any appliance that does not conform to the regulations can be disconnected. Failure to comply with these regulations jeopardise the health and safety of your tenant and could lead to prosecution with penalties of imprisonment and/or fines up to £5,000.

longer need to deduct tax. Please note that where there are joint landlords (including married couples) an exemption is required for each landlord. Our staff will be happy to discuss these arrangements with you. Do I need to tell my insurance company? Most certainly yes - otherwise you may find your insurance is invalid. Your insurer may wish to increase the premiums or be unable to accommodate your wishes. Should you need it, we are able to recommend alternative Buildings and Contents cover as well as Rental Guarantee Insurance. Please ask our team for further details. Do I need to tell my mortgage company? Most certainly yes - prior to the letting of your property you must seek written consent from your lender. Please ask any of our team for further details. What do I do if my property is leasehold? The managing agents or freeholders must be advised as a change in the type of occupancy may affect the buildings’ insurance. You should obtain the freeholder’s or managing agent’s consent prior to letting and advise us of any restrictions within the head lease which your tenant should be aware of. Who looks after the garden? The maintenance and upkeep of the garden is usually the responsibility of the tenant. However, should you have a particularly large garden or any precious plants then it may be advisable to arrange for a gardener - the cost of which should be incorporated in the rental value. You should leave the necessary tools and equipment for a tenant to take care of the garden. Are smoke alarms required? Smoke alarms have to be installed in any new building or conversion. We would strongly recommend that you install at least one alarm per floor of your property. What am I responsible for repairing? As a landlord you have a legal obligation under the Landlord and Tenant Act 1985 to maintain the structure of the building, the sanitation and the supply of services. In addition, should an item in the property require replacing or repairing through fair wear and tear then you would be expected within the terms of the Tenancy Agreement to deal with this. This guide is not exhaustive in terms of liabilities and legislation to which a landlord must adhere but is aimed to provide an overview of the typical issues which may arise.

Frequently Asked Questions Why do I need an agent? There is nothing to prevent a landlord acting without an agent. However, there are many legal requirements that a landlord has to fulfil and failure to comply with these requirements may result in criminal prosecution. Our staff are trained to understand current requirements, keep abreast of any changes and have systems in place to ensure they are complied with. We properly vet potential tenants and undertake full independent referencing at no cost to you allowing you to make the right choice. How is the rent paid? Typically a standing order is set up from the tenant’s bank account and the rent will be paid monthly in advance. Our fully computerised systems mean that once the monies have ‘cleared’ through the banking system the rent is paid promptly into the account of your choice. A detailed statement of account is provided. What sort of Tenancy Agreement is used? There are a number of different types of agreement that can be used depending on the circumstances of the tenants, the landlord and indeed the property. In the majority of cases it will be what is called an Assured Shorthold Tenancy (AST) for a fixed period of a least 6 months. What happens if the tenant doesn’t pay the rent? As part of our rent collection or fully managed service we endeavour to ensure that the rent is paid on time. Having carefully selected the tenant in the first place, there’s unlikely to be a problem. However peoples’ circumstances do sometimes change during a tenancy and if the rent is not paid, we’ll advise you on the appropriate course of action. What about a deposit? We ask tenants for a deposit which is usually equal to one month’s rent. It will only be returned when the tenant has given vacant possession of the property and left it in a satisfactory condition, allowing for wear and tear, and complied with his or her responsibilities under the Tenancy Agreement. What happens when my property is empty? You must advise your insurance company in accordance with their requirements regarding empty property. Please check your insurance policy for the relevant details. What are my outgoings? These will usually include: Mortgage Insurance (Buildings and Contents - only if furnished) Rental guarantee Insurance - (optional) Repairs to the property (unless damage caused by the tenants) Ground rent and services charges (where applicable) Managing agent fees (where applicable) Utility bills and services (when property vacant) Council tax (when property vacant) Servicing of any boiler What about tax? You will be liable to pay tax on any profit generated from letting your property - the amount of tax you pay will depend on your circumstances. If you are overseas for more than six months in any tax year, you will be regarded as a non-resident Landlord. The current legislation requires us to deduct and pay over to the Inland Revenue tax at the basic rate unless we are in receipt of an exemption letter from the Inland Revenue. Once we are notified by the Revenue that you are exempt, we will no

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