LANDLORD LEAFLET. Information & Guide for Prospective Landlords ARE YOU THINKING OF LETTING YOUR HOUSE, FLAT, BED-SIT OR HOLIDAY HOME?

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1 1 LANDLORD LEAFLET Information & Guide for Prospective Landlords ARE YOU THINKING OF LETTING YOUR HOUSE, FLAT, BED-SIT OR HOLIDAY HOME?

2 A Detailed Guide for clients leasing property Before we deal with leasing your Property for you, WE WILL ASSUME the following:- 1. You have first obtained the consent of your Mortgage Lender to lease your property. We will not deal with this, nor deal with any requirements of your Lender unless they specifically write to us. 2. You have personally checked that the furnishings comply with the Fire Safety Regulations and any furniture or furnishings included in any Inventory of Furnishings will comply with the requirements. We will not check this. You will be responsible for any failure of the furnishings to comply, if the regulations apply to you. 3. You have had the gas and electrical appliances and installations inspected by a suitably qualified installer and will provide a certificate confirming that such appliances or installations comply with current safety regulations. The Gas Certificate requires to be updated annually. Alternatively, we can arrange this for you and the cost will be charged to you as an outlay. 4. You have advised your insurance company of your intention to let your property and dealt with any of their requirements. 5. You have registered as a Private Landlord with the local authority. If you are unsure of this requirement, we would refer you to the Legal Services Department of the Highland Council (or other relevant local authority if your property is outwith the Highland Council area) or online at The usual form of tenancy and the one that gives you most protection to ensure you can recover possession of the property at the end of the tenancy period is a "Short Assured Tenancy". This is for a minimum of six months but can be for longer or can be continued. For a tenancy to be a Short Assured Tenancy and benefit from the relevant legislation, a tenant must be given special notices before any tenancy agreement is created or the tenant is allowed to move into the property. If you have a mortgage over the property, you will need to obtain the consent (preferably in writing) from your mortgage lender before allowing a tenant into your property. Letting your property may affect your buildings and contents insurance. If you intend leaving carpets, curtains, furniture, equipment or crockery for the tenant's use, all items must be listed in an Inventory (List of Contents) which should list everything room by room. It should include any garden tools or equipment. Any item which is marked or damaged should have this noted against it. The Inventory will be attached to the Tenancy Agreement and checked over with the tenant when the tenant moves out. If you are to provide the Inventory, this must be given to us before the lease is due to commence. Please ensure that you provide a typewritten inventory. A deposit is requested from the tenant to be paid "up front" along with the first month's rent. This is kept safely and given back to the tenant at the end of the tenancy under deduction for any breakages, damage or under payment of rent. The deposit is usually one month's rent. Page 2

3 It is usually best for the monthly rent to be paid by the tenant, after the first month, direct into a bank or suitable building society account in your name, by standing order. You should ask your bank or building society to send you a Statement each month just a few days after the proper day for rent to be paid in so that you would notice almost at once if the money does not arrive and you can speak to the tenant about it or ask your solicitor to do so before the situation gets out of hand. Please provide your solicitor with details of the name of your Bank or Building Society, Account number and Branch sort code so that these details can be incorporated in the Lease. The Bank clearing system requires time for funds credited to your Account to clear. If payment of rent on a due date is essential (for example, if your mortgage payment is due) you MUST advise us of this so that the appropriate provision can be made in the lease. Before the tenant moves in, the Hydro Board, the Gas Board (or other gas supplier), British Telecom and the Highland Council (re. Council Tax) require to be advised of the tenant moving in on a certain date. Final readings will be taken and billed to you and the tenant will become responsible for the various services and Council Tax during the period of his or her tenancy. It is important the tenant becomes responsible for these accounts so that you will not be left with any nasty bills when the tenant moves out. You must also contact the insurance company or companies, which cover your buildings and contents in plenty of time, to tell them that you intend to let your house. Often they will agree to this only on certain terms and you need time to deal with this. Note you are not responsible for insuring the tenant s possessions in the house. If you are to be abroad whilst the property is let, and we are instructed to factor the property, we will require to complete Annual Tax Returns to the Inland Revenue in respect of the income you are obtaining from the property you are letting out. If this applies to you, please let us have details of your tax code so that we can complete the relevant forms. Whilst various precautions can be taken by us on your behalf before letting your property, this does not always guarantee that the tenant will keep the property in as good a condition as you would keep it yourself. Similarly, a tenant's personal circumstances may change. Should you encounter any difficulties with your tenant or require to take court action to remove the tenant or collect rent, our in-house Court Department will be able to assist. Page 3

4 FURNISHINGS There are important Regulations now, laid down by Parliament, about the flammability of upholstered furniture in houses, flats, bed-sits and holiday houses which are let out to tenants. Your solicitor can tell you more about this but in the main, all upholstered furniture must have a sewn-in or permanently fixed label on it saying, e.g. CARELESSNESS CAUSES FIRE NAME OF FIRST SUPPLIER BATCH NUMBER OR IDENTIFICATION NUMBER DATE MANUFACTURED OR IMPORTED DESCRIPTION OF FILLING MATERIALS DESCRIPTION OF COVERING MATERIALS WHETHER OR NOT THE ARTICLE INCLUDES A FIRE-RESISTANT INTERLINER Upholstered furniture means, for example: Beds, headboards and mattresses, sofa beds and futons, nursery furniture, garden furniture that is suitable for use in the house, scatter cushions and seat pads, pillows, loose and stretch covers for furniture. It does not mean: Bedclothes, including duvets, sleeping bags, loose covers for mattresses, pillowcases, curtains and carpets. You must check all items that are upholstered to make sure they have this label. Only relatively new upholstered furniture has this label. If they do not have the label, they must not be left in the property while the tenants are living there, because of the dangers of fire involving older types of foam and covers. SMOKE ALARMS - there are now specific requirements for smoke alarms. Information on this should be contained in the Advice Pack you should receive from the Scottish Executive once you are registered as a Private Landlord or visit GAS APPLIANCES, including CENTRAL HEATING these must be inspected and, if necessary, serviced before a tenant moves in, and every year after that. A qualified installer must do this and must also issue a certificate that the inspection/service has been carried out and that the appliances/system meet the regulations. There can be serious repercussions for you as Landlord if the systems do not comply with current requirements. ELECTRICAL APPLIANCES AND INSTALLATIONS there is no statutory period for these to be checked but it is recommended that they be inspected every 3 5 years but you may wish to have these checked more often for your own protection. The onus is on you to ensure that the property complies with all relevant regulations. The above information is for guidance only. REPAIRING STANDARD FOR LANDLORDS You should automatically receive an Advice Pack from the Scottish Executive once you are registered as a Private Landlord but briefly, since 7 September 2007, a new benchmark standard was set for landlords to ensure their property is kept in good order and repair. For further information on this obligation on landlords, visit Tenants can report a landlord to the Private Rented Housing Panel (PRHP) if a landlord fails to maintains/repair his property to the required standard. If you have any queries in connection with any of the information contained in this leaflet, please contact either our Letting Manager who will be pleased to help. Page 4

5 REQUIREMENTS FOR LANDLORDS LETTING PROPERTY To assist in the letting of your property and to minimise difficulties for tenants, we request that you leave a folder of useful information for tenants to include all instruction booklets (or copies) in connection with the central heating and any appliances in the property. If instruction booklets were not available, we would suggest that you leave a folder for incoming tenants. It would be helpful if you could also let us have the information noted below for our file, particularly if we are to be factoring your property under Option 3, detailing the following information: FOR EMERGENCIES 1. Location of stopcock and fuse box (if fuse box not immediately available/obvious). 2. Details of your insurance company and policy number (we would remind you that you would need to ensure that your insurance company will know that the property will be let and that your insurance covers the letting of the property). 3. Any emergency contact number for a friend or relative outwith office hours. ESSENTIAL AND USEFUL INFORMATION 1. One point, which causes particular concern, is the operation of the central heating system. Many plumbing "emergencies" could be avoided if sufficiently detailed information is provided to incoming tenants about how to operate the central heating system or how you may have operated it yourself or if there are any "quirks" of the system which should be made clear to tenants. It would be helpful if you could leave a simple note in the folder for tenants telling them how to set the time clock and explain the different settings, in addition to any instruction booklets. 2. Collection days/times for refuse/garden refuse/papers, if applicable. 3. Keys should be left for access to the meters for these to be read. 4. Keys should be left for all lockable doors and windows. If you have a preferred plumber/heating contractor, electrician or "odd job man" who can deal with small repairs it would be helpful if this information and any contact numbers for these people could be left with us. Anderson Shaw & Gilbert reserve the right to contact the contractors they normally use if your preferred contact is unavailable or unable to effect a repair quickly enough. CONDITION THE PROPERTY SHOULD BE LEFT IN The property should be left in a clean and tidy condition ready for immediate occupation by tenants. There is little incentive for a tenant to keep a property in good order if the property is not in excellent condition when the tenant takes up occupation. By this we mean: The property should be vacuumed and dusted prior to departure Kitchen - all work surfaces and floor vinyl should be wiped clean Oven and Hob - these cause most difficulties and it is expected that the oven and hob will be in very clean condition with no surface debris Sinks, bath/ shower and toilet bowl should be spotless and all grouting clean and intact. Grouting failures are major causes of leakage- please check and renew if required. Any curtains and blinds should be left in clean condition The windows and external doors should be left clean Any smoke alarms MUST be functioning properly - install new batteries if necessary If any appliances are not functioning correctly or anything needs repaired, please ensure that these matters are attended to prior to your departure as they are otherwise likely to cause immediate problems for tenants and may result in unnecessary expense if tradesmen require to be called out. We issue this advice to landlords on a standard basis and no offence is intended to any landlords who will without prompting leave their property in excellent condition. Page 5

6 Leasing Services You, no doubt, have thought carefully about letting your property, particularly if you want to return to live there. Now let Anderson Shaw & Gilbert help you find a suitable tenant and advise you fully on your responsibilities as a Landlord and assist you with the procedure necessary to create a legally binding Tenancy Agreement. Our leasing services allow you to take as much responsibility as you wish and are detailed overleaf. These can include: FREE rental assessment [within a 5-mile radius of Inverness] The safety and repair regulations which affect you Effect on insurance and your mortgage Marketing your property for let Arranging viewings Finding a suitable tenant Obtaining references Pre-tenancy inspection and photographs Advising service suppliers Statutory Notices required Preparing a Tenancy Agreement Income tax for non-residents Bringing the lease to an end Our Leasing Department has extensive knowledge of the local rental market and our team of qualified solicitors can ensure that a professionally prepared lease adequately protects you. In addition, we have an extensive computerised mailing list of potential tenants so that details of your property can be given to recent enquirers matching their requirements with your property. The lists of our properties for rent are also regularly sent to our mailing list enquirers. For a FREE no obligation discussion about your plans speak to our Letting Manager who will be pleased to help. Page 6

7 Leasing Options OPTION 1 - LEASE only, where you have already found a suitable tenant. Includes: taking detailed instructions preparation of Lease service of relevant statutory notices on tenant completion of lease Thereafter, you will handle management of the tenancy. OPTION 2 - LEASE SERVICE Designed for the Landlord who wishes to deal with the day to day letting of the property but wishes us to deal with any matters involved in setting up the Lease. In addition to services provided in OPTION 1, this service includes: initial visit and rental appraisal arranging marketing and viewing obtaining references Please note that once the lease has been set up, you will be the contact point for the Tenant for ALL matters arising during the tenancy. OPTION 3 - FULL FACTORING SERVICE (Generally within 10 mile radius of Inverness) For the absent or busy Landlord who wishes to be relieved of the ongoing management of the lease. In addition to services provided in OPTION 2, this service includes: retention and investment of deposit during tenancy pre-tenancy inspection and photographs dealing with tenant enquiries monitoring and remitting rental payments, and initial chasing of any arrears dealing with day to day correspondence arranging regular inspections arranging repairs in consultation with you. Options 1 and 2, the deposit will be paid to you for you to invest during the tenancy and Anderson Shaw & Gilbert will not be involved in refund of deposit to the Tenant. Page 7

8 PRICE MENU 1. OPTION OPTION OPTION plus 12½% of monthly rental collected 4. (a) Preparation of Inventory 50 minimum (Where this is not supplied by landlord) [dependent upon time involved] (b) Transcription of inventory (Where no typewritten version supplied by landlord) Mileage will be charged [per Note 2 below] 6. Viewings If we are required to show the property to potential Tenants. If within 10 mile radius of Inverness 10 per viewing ** If outwith 10 mile radius of Inverness 20 per viewing ** 7. Additional monthly inspections - Mileage will be charged per Note 2 below NB: OPTION 3 includes 3 FREE inspections in a six-month Lease. If within 10 mile radius of Inverness 10 per inspection ** If outwith 10 mile radius of Inverness 20 per inspection ** 8. Inventory check At expiry of lease 25 minimum 9. Termination of Lease Service of Notice to Quit and associated standard correspondence dealing with removal of tenant (not including any subsequent court procedure) Amendment of existing Lease E.g., where change of co-tenant, rent increase Any additional work outwith what is included within our various Options, will be charged for separately on a time cost basis. NOTES: 1. VAT on all fees will be charged at 17.5%. 2. Outlays will be charged where incurred, e.g., advertising, mileage, viewings, electrical and gas inspections, bank charges and stamp duty (if applicable). ** NOTE: Mileage will be charged for ALL attendances at the property at the rate of 45p per mile. Such mileage charges are in addition to the fees quoted above. However, we offer a FREE rental assessment for properties within a 5-mile radius of Inverness. 3. Fees at 8 and 9 may be waived if you instruct Anderson Shaw & Gilbert to sell or re-let the property on termination of the tenancy. 4. All fees quoted include posts and incidental expenses. 5. The above fees apply to transactions involving our standard amount of work. However, should considerable additional work be involved, beyond what would ordinarily be involved in a typical transaction, we reserve the right to charge for such additional work at Law Society rates. Page 8