Many investment property owners are under the misconception that once the paperwork is signed and they officially own a new asset, that becoming a landlord is the easy part.
Tenant management can be a difficult feat, particularly if the responsibility is not considered carefully from the beginning. Before even comprehending rent collection, all new landlords must contemplate and adhere to a ‘tenant checklist’ before accepting signed tenancy paperwork.
Prior to renting the property, all landlords should consider the following.
1. The legalities
Although it may seem blindingly obvious, many landlords don’t consider that they should check if their new occupants actually have a ‘Right to Rent’. A ‘Right to Rent’ is a mandatory condition in various countries, and failing to assess this can result in large fines.
Tenancy agreements are a necessity when renting out any property. They are a legal document and are best advised and written by a legal professional, who will ensure that the landlord and property is protected in all circumstances, while still considering the rights of the tenant. Tenancy agreements need to be fair, transparent and detailed.
Every tenant that is moving into a new home will expect it to be safe. Smoke alarms, fire safety processes (including carbon monoxide testing in necessary areas) and gas checks must all be completed prior to letting.
3. Function and liveability
Depending on the property type, landlords may be providing various assets within the home for the tenants use. The expected additional assets are often ovens, showers, electricity and water connections. These assets must all be checked for compliancy and usability before a tenant moves in. Checking the appliances before handing over the keys will prevent costly repairs, as the assets suddenly need to be fixed quickly.
4. The finances
Legally, deposits need to be protected within 30 days. In order to avoid fines, it is important to check a potential tenant’s financial status, to ensure that they can pay the deposit.
If a landlord is anticipating to eventually increase the rent, they must be protected by this by a clause in their tenancy agreement, and tenants will expect to be given a decent amount of time in notice.
5. The agreements
Future tenants should always be reference checked. Ideal candidates have a rental history and a glowing reference from their employees or former landlords.