Know the risks
Every investment has a risk and buy-to-let is just one example of that. Having a bad tenant could cost a lot; your property could be damaged, rent may be unpaid and you may need to take legal action to evict them. The deposit you hold will rarely cover these costs so finding the right tenant and trying to mitigate that risk is very important.
You might choose to use a ‘tenant find’ introductory service from a local agent who will advertise and conduct viewings and credit checks.
If you do not wish to use an agent to find your tenant for you, it is possible for you to advertise for a tenant. You would get to meet your potential tenants and you can see who you feel comfortable with. You might want to get references from old landlords, employers, teachers and lecturers or, family and friends. Talk about guarantors, you might even want to do a credit check using online companies.
If you do conduct your own credit checks, do not be afraid to ask questions for more information. If potential tenant has moved a lot, ask them why? There may be a legitimate reason they moved; maybe they were unsettled or needed to relocate, maybe the landlord needed the property back but perhaps they are nuisance tenants. You need to ask questions and above all, do not be afraid to go with your gut instinct.
Find a way that works for you – you may prefer keeping a professional boundary from your tenants e.g. having a managing agent, giving tenants the number of your maintenance team to report maintenance to and giving them your email address as a preference so they can email you any queries. You will of course need to have a good relationship with your maintenance team and they must be good at their job to keep your tenants satisfied. Remember at the end of the day, you are the landlord so you need to protect yourself from any actions of third parties (e.g. any agents) and make sure you are at least kept informed of any issues.
Alternatively you may prefer to deal more directly with your tenants. It all depends on how involved you want to be. Either way, set out the boundaries at the beginning of the Landlord/Tenant relationship.
Sign on the dotted line
Once you have a tenant you will need a solid tenancy agreement the most common is an Assured Shorthold Tenancy, also known as an AST. There are some sites that offer a basic versions of tenancy agreements and you may wish to amend as you see fit. The sensible thing to do, to ensure you are fully protected and informed and to confirm that the terms of the tenancy agreement are legally enforceable and suitable to your situation, is to speak to a solicitor and perhaps have them draft an agreement for you.
If you went down the route of having an agent conduct a tenant find service, they will offer you an agreement, again you may wish to alter this. Do not assume it is OK and do not be afraid to ask for amendments to it.
We’re here for you, if you need any assistance or advice please do not hesitate to call us on 02392 296296.