Starting your journey of becoming a landlord can be both rewarding and exciting. Not only does it provide a consistent source of income but it also can serve as a long-term investment.
However, it’s vital to have a solid foundation of knowledge and understanding of what the job entails before venturing into the world of landlordship.
In this article, we’ll discuss four essential things you need to be aware of when becoming a landlord, which will help you to navigate the many challenges and responsibilities associated with the role.
Familiarise yourself with the laws and regulations
Before you start renting out your property to tenants, it’s crucial that you take a look at the laws and regulations that apply. These govern various aspects like tenants’ rights, eviction processes, lease agreements, and property maintenance standards.
It’s also important to keep updated with any changes in the law, including those stated in the Renters’ Reform Bill 2023. Such changes include the abolition of ‘no fault’ evictions, which means landlords can only evict tenants under valid circumstances defined by law. Additionally, rent increases will be limited to once per year and landlords must give a minimum of two months’ notice for these increases.
Being well-informed about all of these will ensure you operate within the law and will further help to maintain a positive relationship with your tenants.
Establish clear policies and lease agreements
To uphold a smooth relationship between you and your tenant, it’s important that you establish a clear rental policy and comprehensive lease agreement. Clearly outline your expectations regarding rent payments, deposits, maintenance responsibilities, and any other regulations you wish to put in place.
A well-drafted lease will help to prevent any misunderstandings and provides legal backing to address issues that may transpire during the tenancy. If issues do occur, and these are to be sorted by you, make sure that they are resolved promptly. Open and consistent communication with your tenants is key to a productive tenant-landlord relationship.
Obtain relevant landlord insurance
It’s vital that you protect your investment by taking out a landlord insurance policy. While not required by law, doing so may help if there is damage to the property, loss of rent, or the tenant is injured in the property.
Standard homeowner insurance doesn’t always provide adequate coverage for rental properties, so it’s always best to consult with a landlord insurance professional that can direct you toward the best policy.
Screen potential tenants thoroughly
Selecting the right tenants is essential for a successful tenant-landlord relationship. Introduce a robust screening process that can evaluate a potential tenant’s employment status, credit history, background checks, and rental references.
By investigating the history of a tenant, you are more likely to choose someone who is reliable, will meet their financial obligations, and will take good care of your property. It will also reduce the chances of property damage and problematic tenancies.