If you’re a residential landlord - or are planning to rent a residential property - take note. New legislation comes into force today (1 October 2015) adding a number of new checks and processes which must be carried out.
These changes do not replace the existing landlord obligations, which exist in law, but now is the time to make sure you are compliant with both new and existing legislation.
Our guide provides helpful summary of relevant regulations and what you need to know when finding a tenant for your home.
Have you obtained a credit check and reference for the tenant?
Is the tenant in employment? Have they fulfilled previous tenancy obligations? Will they be able to afford their financial commitments?
These have always been important questions, but under the new rules, the need to carry out a thorough credit check is now even more pressing. Without proper background information for a prospective tenant, including references, you risk the tenant falling behind with their financial commitments, such as rent, council tax and utility bills.
Obtaining accurate information will also assist you in making an informed decision as to whether your prospective tenant is suitable and responsible. If done properly, it is more likely that your property will be well maintained and payments will be made on time and in full for the duration of the tenancy.
Have you taken a deposit?
If you take a deposit from the tenant then you need to protect this promptly in a Government approved ‘deposit scheme’. These schemes provide assurances for both the tenant and the landlord that the deposit is protected and will be handled fairly in case of any disputes when the tenant vacates the property. The available schemes are listed below:
- Deposit Protection Scheme (DPS)
- My Deposits
- Tenancy Deposit Scheme (TDS)
The law stipulates that you must protect any deposit in one of the above schemes within 30 days of receiving it. If you fail to do so, you risk being liable for a fine and the tenant can be awarded compensation up to three times the value of the original deposit.
When you protect the deposit, the relevant scheme will issue you with a certificate. You must provide a copy of this to the tenant along with the ‘Prescribed Information’, detailing any further terms and conditions relevant to the scheme. This information tells the tenant where the deposit is being held and what will happen at the end of the tenancy, or in case of a breach of contract from either party.
Have you provided the tenant with a copy of the Gas Safety Certificate and EPC?
If the property has a gas supply you must ensure that a gas safety certificate is issued for the property each year. A copy of each certificate should be given to the tenant for their records.
At the start of the tenancy a copy of the gas safety certificate must be issued along with the energy performance certificate. Often, these documents will form part of a ‘pack’, sent to the tenant at the start of the tenancy, along with other information such as the deposit details outlined above.
You should keep a record of how and when you provided copies of these documents, including the yearly gas safety certificates, and keep them safe.
Have you given the tenant a copy of the ‘How to rent: The Checklist for renting in England’?
The ‘How to rent: The checklist for renting in England’ document is a government publication and will be updated regularly. At the start of the tenancy you must provide a copy of this to the tenant. You should also keep a record of when and how this was provided.
It is good practice to ask the tenant to sign to confirm they have received a copy of the checklist. Should any dispute arise in the future, records such as these may be useful in presenting your case.
Have you completed a check-in inventory?
A check-in inventory and relevant photographs depicting the condition of the property should be taken at the start of the tenancy. If a dispute regarding the condition of the property, such as damage caused by the tenant and disputes regarding the deposit, a check-in inventory will help to clarify the situation and could save you money.
Have you installed the correct smoke alarms and carbon monoxide alarms?
As part of the new laws, you will need to ensure that you have installed a smoke alarm on each floor of the property where a room is being used, or partly, used as living accommodation. You will also need to ensure that you have installed a carbon monoxide detector in any room where fuel burning and combustion appliances are present.
When you enter into a new tenancy agreement, you must check that these devices are in good working on the day that the new tenancy begins. It is not sufficient to repair faulty devices once the tenant is living in the property. You may face a fine of £5,000 for failure to comply with this regulation.
Changes to Section 21 notices
In respect of Section 21 notices, there are a number of important changes to be aware of:
- You must now use Form 6A which can be found on the Government’s relevant website
- For tenancies starting after 1 October 2015, you cannot serve a Section 21 notice in the first four months of the tenancy
- Once you have served a Section 21 notice you must issue proceedings within six months of service. If you do not then you will need to serve a new notice before being able to apply to court for a possession order
If the tenant has raised concerns regarding disrepair at the property, you cannot serve a Section 21 notice until a satisfactory response has been provided to the tenant.
If you are a landlord or a letting agent and are thinking about renting out a property then you will need to consider the above and ensure that you have complied. Failure to do so may result in delays in obtaining possession of your property as well as costs and fines.
If you are facing action as a result of allegations that you have not met your obligations to the tenants, call our team of residential landlord experts on 01616 966 229 who can advise you regarding your defence and resolving any issues.