As a landlord there are many practical and legal aspects of managing a rental property. Under the Housing Act 1996, and the Landlord and Tenant Act 1985, landlords have various legal obligations that they do need to make themselves aware of. Similarly tenants also have implied obligations, including paying bills, not to cause damages, paying rent and seeking permissions in certain circumstances. Most of these details are normally detailed inside the Assured Shorthold Tenancy Agreement. It is always sensible to use a qualified solicitor to draft your tenancy agreement to make sure that any recent changes in legislation are reflected in the agreement signed between you and your tenant. Likewise the law grants tenants certain rights, granted by statute, including the right of 'quiet enjoyment'. Make a note to seek some legal advice regarding the things you absolutely must do, in order to comply with the letter of the law the process of managing your rental property.
If you're planning to manage the let yourself, (as opposed to using a letting agent), there are quite a few practical activities that you will need to undertake. Firstly, to simplify property management administration, it's a good idea to collect the rent on the same day each month. This is normally the start date of the tenancy. Add a clause to your Assured Shorthold Tenancy agreement detailing how any potential future increases in rent are to be determined. This must be done in accordance with any statutory restrictions.
Secondly, if you are not used to dealing with tenants, then it might be wiser to use a letting agent to do the property management on your behalf. Effective communication is so critical. Treat your tenants fairly and with consideration but do not get personally friendly with them (even if you like them). If you set their expectations fairly at all times, avoiding confusion (whether it be personally, on the phone or via a letter), your tenancy should run smoothly.
Thirdly, it is a fact of life that boilers break, roofs leak, washing machines stop working and so on. These types of unforeseen management repairs also include painting and decorating, treatment of wooden furniture for damp, replacing leaking pipes etc. If you are using a letting agent, they will usually have pre-agreed management responsibility to fix minor problems. If you are not using an agent you must be prepared to accept phone calls at any time and be responsible enough to sort out angry tenants. You cannot undertake major works or major improvements on your property (like converting the loft) without consulting and getting the permission of your tenant first. The tenant has right of �quiet enjoyment�.
Fourthly, you must make sure all property gas pipe work (valves, pipes, regulators and meters) and installed appliances (cookers, hobs, boilers, water heaters, fires, wall heaters, gas fridges, flues, central heating systems, fires etc) are checked, maintained annually by a Engineer and hence safe.
Fifth, make sure your property tenancy agreement includes a clause about the requirement to do half yearly inspections to ensure the property is being well looked after. This will also allow you to see if any repairs need undertaking that the tenant may not have informed you about (or they have overlooked the need to do a repair).
Six, you mist submit annual accounts to the Inland Revenue, showing any profit or loss and hence tax payable as a result of your investment; Seven, regular expenses and rental income should ideally be managed using a separate business bank account. Having a separate account will simplify accountancy matters and allow you to understand your cash flow position; Lastly, if you are managing the let yourself (property management), there is an inevitable level of hassle and administration to deal with and pay for.
In order to ensure the smooth inventory check out process for both yourself and the tenants, a simple documented process should be pre-agreed by both parties. It helps sets the expectations of your tenant(s) if you send a letter a few weeks beforehand explaining the process, reminding them that any small items that may have been broken must be replaced and outlining the process for the return of their deposit. Remember to advertise the property for re-letting, a couple of weeks before the checkout date to eliminate void periods for getting new tenants in.