Q: Are there any special laws I need to be aware of?
A: Most lettings in England and Wales are very straightforward, and come under the Housing Act 1988 (as amended). Special regulations cover the safety of the gas and the electrical installation, and appliances supplied. The landlord must also ensure that furniture and furnishings comply with regulatory standards for fire safety (all furniture sold new or second-hand through normal retail outlets must now comply).

Q: What is the prs?
A: The private rented sector (prs) is that part of the country's housing that is privately owned, and is let for residential purposes on short lets (leases are normally for fixed terms of less than seven years, and are typically for just six months or a year, but on a renewable basis).

Q: Do I need special insurance?
A: Yes. Your insurers will charge more for a let property than for an owner occupied property. If you are an owner occupier planning to let your own home, your policy may be invalidated if you let without informing your insurers. For qualifying tenancies, insurance may also be taken out for non-payment of rent and for legal costs.

Q: What is an HMO?
A: A house in multiple occupation (HMO) is a property, originally built or designed for one household, that now contains more than one household. This includes self-contained conversion flats (but not purpose-built flats), as well as bedsits etc. with shared facilities. The local authority may impose expensive fire safety and amenity requirements on an HMO. Find out what the rules are locally before you invest.

Q: I hear some horror stories about tenants, are they true?
A: 95% of tenants are respectable people, who will pay the rent and look after your property. Inevitably there are occasional bad ones – you must take care in choosing your tenant. Like many investments, there are some risks in letting property. Taking voids into account as well, it is sensible to plan on only getting about 85% of the maximum potential rent in any one year.

Q: What sort of Acts of Parliament & Statutes England and Wales cover letting proeprty?
A: The Law relating to residential and commercial letting is a complex area and has a dual nature: common law (judge-made law) affects the contracts made between landlord and tenants in the form of leases and tenancy agreements. However, even where the landlord and tenant have a comprehensive agreement covering all or most eventualities, Acts of Parliament often override what the parties have agreed to. This is particularly the case in residential tenancies, much less so with commercial ones. A short list of laws convering residential letting is provided on the section "Business matters - Legal"

Q: Should I let my property?
A: There are many reasons why owners consider letting their properties. The most common reasons include: can't sell: owners often want to buy another house but can't sell their existing house at the right price or quickly enough to stop a chain breaking down, possibly because it's a buyer's market at the time won't sell: many owners want to move but don't want to sell their house because they (or their family) might want to return or because prices are too low at the time spare property: a property may become unoccupied, either temporarily or permanently, owing to the illness or death of a member of the family investment: letting properties can often be a good short or long term investment with gross returns of around 10% It costs money to keep a property empty in mortgage payments, council tax, fuel bills (or at least standing charges), insurance and dilapidation, and there is a continual risk of vandalism, squatters and complaints from neighbours. If you let your house the rent should cover your bills and leave you a profit. Let it for long enough and you'll be able to pay off the mortgage and still have the house and an income. You can get your house back whenever you need it. You can charge any rent you agree with the tenant. The house will be kept heated, cleaned and maintained. With proper checks you can make sure that the tenants will pay the rent and look after the property.

Q: Are oral tenancies valid?
A: Oral tenancies are valid providing that: they take effect on the day they are granted they are for a term not exceeding three years they are granted for the best rent reasonably obtainable without taking a premium. In all other circumstances they must be created by deed. It is always better to document a tenancy in writing so that there can be no doubt about the terms of the agreement. Note also that under the Housing Act 1996 it is mandatory for the Landlord of a new Assured Shorthold Tenancy to provide certain terms in writing.

Q: What is a break clause?
A: A break clause in a lease or tenancy agreement allows either the landlord or the tenant (or both) to terminate a lease even if it has not run its full length. Under no circumstances should a break clause be exerciseable by a landlord within the first 6 months of an Assured Shorthold Tenancy.

Q: What are the risks?
A: The main risks which a landlord faces are: the tenant may not pay the rent the tenant may not look after the property It is usual for landlords to take a returnable deposit (or "bond") from the tenant as security against the tenant damaging the property or not paying the rent. This provides some protection to the landlord. The best protection for the landlord is a good relationship with the tenant, together with regular inspections to ensure that the property is well maintained.

Q: What will I be responsible for as the landlord?
A: Landlords are normally responsible for: repair and maintenance of the structure and exterior of the property including fixed drainage, plumbing, heating and hot water installations (including baths, sinks, toilets, etc) the safety of the electrical installation and any electrical appliances provided by the landlord the safety of the gas installation and gas appliances provided by the landlord, and completion of the statutory annual gas safety check the safety of any furniture and furnishings provided by the landlord

Q: What will I have to pay if I let my property?
A: Normal expenses incurred by a landlord are: the mortgage the buildings insurance (contents insurance is optional) the annual gas safety check (if there is a gas supply to the property) the agent's fees (if an agent is employed) the cost of repairs (if any) It is worth remembering that all the items listed above will normally be tax deductible (see below)

Q: What are the tenant's responsibilities?
A: Tenants are normally responsible for: paying the rent paying the council tax, and the bills for water, electricity and gas (if installed) looking after the property repairing any damage which he/she (or a guest) causes Tenants may be made responsible for: maintaining the garden internal redecoration when required

Q: Can I place restrictions on the tenant?
A: Any reasonable restriction which you agree with the tenant and include in the Tenancy Agreement will be binding on the tenant. Common restrictions include: prohibiting pets in the property (eg cats and/or dogs) prohibiting smoking in the property Certain activities, such as carrying on a business from the property, should always be prohibited as they may invalidate the Tenancy Agreement if they are not.

Q: Should I let my property furnished or unfurnished?
A: This is entirely a matter of choice, but some factors to take into account are: whether a property is let furnished or unfurnished does not make much different to the rent which can be obtained, but it may make the property more easy or more difficult to let many tenants (both professional and on benefit) have their own furniture, but tenants living elsewhere who are renting in order to have a base in the area will often require fully furnished properties tenants renting unfurnished properties often stay longer that tenants renting furnished properties (unless they are renting while they look around for a property to buy) furniture will sustain an element of fair wear and tear, however carefully the tenant looks after it fully furnished property attracts a tax allowance of 10% of the gross rent (see "What about tax?") furniture must meet the safety regulations, and should be maintained in a good condition

Q: Do I have to change my mortgage?
A: Probably not. You should check with your mortgage lender whether they will give you permission to let your property on a temporary or permanent basis as soon as you are thinking about letting your property, and you should obtain their permission before you actually let it. If your mortgage lender will not give you permission there are many lenders who will give you a mortgage, often at normal rates of interest. Most of these will give you a mortgage to buy a property you intend to let as an investment.

Q: Do I have to change my insurers?
A: Probably not. You must tell the company that insures your property that you are letting it to a tenant. If you don't, and you need to make a claim, the company will be entitled to refuse your claim. If your insurer does not agree to insure your property if it is let to a tenant there are many insurance companies which will provide insurance at normal rates.

Q: Can I visit the property while it is let?
A: A landlord is entitled to visit and enter his/her property to inspect or maintain it at a reasonable time of the day and after giving reasonable notice to the tenant. Except in an emergency, you should give at least 24 hours notice to the tenant and agree any reasonable alternative appointment suggested by the tenant. You should not normally enter the interior of the property without the tenant's permission, or visit the property too often, or you may be accused of harassing the tenant.

Q: What would be my safety responsibilities?
A: You would be responsible for ensuring that the property is in a safe condition. You should take all reasonable care to ensure that the property is free of any defect which may present a hazard to any Tenant or visitor. If you have reasonable concern regarding the safety of the property you should obtain a specialist report. The law does not expect landlords to be experts, but does expect landlords to exercise due diligence in ensuring that any property they let is safe. You would be expected to notice (and correct) such things as unsafe carpet edges (which may cause a tenant to trip and fall), insecure hand-rails, frayed electrical leads or bare wires, and incorrect fuse ratings. There are specific requirements relating to gas and electricity and upholstered furniture:

Gas Safety It is a legal requirement that any gas installation and each gas appliance provided by the landlord in rented residential property is checked once each year, and that a copy of the safety certificate is provided to the Tenant. You can instruct any CORGI registered gas installer to complete the "Landlord's Gas Safety Check" and provide one copy of the certificate to you and one copy to the tenant.

Electrical Safety Landlords owe a duty of care to tenants, and are responsible for ensuring that the electrical installation in rented properties, and portable electrical appliances provided by them, are safe. There are, however, no detailed mandatory checks specified by law. The recommended method of ensuring that the electrical installation is safe is to obtain a "Periodic Inspection Report for an Electrical Installation" from a contractor approved by the NICEIC. The inspection should be repeated at the interval recommended in the report (often every 5 years). The recommended method of ensuring that electrical appliances are safe is to have an electrical contractor complete a "Portable Appliance Test" (PAT) on each appliance. This test will ensure that each appliance and associated electrical lead is safe, and that the electrical plug has screened pins and is fitted with the correctly rated fuse.

Furniture and Furnishings All upholstered furniture (excluding carpets, curtains, bed-clothes and furniture made before 1950) provided by the Landlord of rented residential property must comply with the Fire and Furnishings (Fire) (Safety) Regulations 1988. You must ensure that any furniture you provide which is covered by the Regulations meets the requirements

Q: What about tax?
A: You should notify your local tax office as soon as you have let the property and are receiving rental income. You may wish to ask the tax office to send you a copy of booklet IR150 (Taxation of Rents). Expenditure incurred "wholly and exclusively" in connection with the letting of your property is normally allowable against your rental income in working out your tax liability. In simplified terms each item of expenditure generally falls into one of three categories: Purchase and improvements: this includes the cost of purchasing, extending and improving the property. These expenses cannot be claimed as allowable expenses, but interest on loans taken out to fund the costs (for example mortgages) is allowable. This means, for instance, that all your mortgage interest is allowable. Repairs and running costs: this includes allowable expenses (excluding the costs of purchase or improvement of the property and the provision of furniture furnishings and fixtures). It normally includes the cost of routine repairs and maintenance, annual gas safety checks, agency fees, insurance premiums and similar expenses. All these expenses are normally allowable. Furniture: This includes the cost of providing or replacing furniture, furnishings, fittings and appliances in fully furnished residential accommodation. A "renewals allowance" may be claimed or, which is usually advantageous, an allowance of 10% of the gross annual rent may be claimed whether or not any expenditure has been incurred. Any applicable allowances are deducted from the gross rent in order to arrive at a net taxable rental income which is then taxed as income. The rules are slightly different for landlords who live in the UK and those who don't: UK Resident Landlords You will be required to account for your income and expenditure as a landlord on your Self Assessment tax return each year. You should ensure that you have received the appropriate sheet when you receive your Self Assessment return, and request an additional sheet if you have not been sent one. Non Resident Landlords If you live, or intend to live, overseas your agent (or your tenant if you do not employ an agent) is obliged to deduct income tax at the basic rate from the rent and pay only the balance to you, unless you have obtained an exemption certificate from the Inland Revenue in the UK.

Q: What do I do when things go wrong?
A: Even the most careful landlord and letting agent cannot avoid the occasional problem. This section contains advice on some of the more usual problems.

My property is let on an Assured Shorthold Tenancy and I need it back A landlord of an Assured Shorthold Tenancy can only regain possession of the property within the first 6 months if the tenant has not paid the rent or is in serious breach of a term of the tenancy.

A landlord of an Assured Shorthold Tenancy can only regain possession of the property during the initial fixed term (if any) specified in the Tenancy Agreement if there is a "break clause" in the Agreement allowing the landlord to terminate the tenancy.

If neither of these restrictions apply (ie if the initial fixed term or the first 6 months - whichever is the longer - will have expired by the time you require possession) you must give 2 months notice in writing to the tenant. The following conditions must be observed: the notice must be served on or before the start of a tenancy period; a tenancy period for a tenancy where the rent is paid monthly runs from the commencement date of the tenancy to the same date of the following month, and so on the notice must expire on the end date of a tenancy period two months later the notice must be served on each tenant individually (if there are more than one) except that a married couple need only receive one copy between them the notice must contain certain facts and it is advisable to use a standard form a method of proving that the notice has been served (recorded delivery, independent witness) is recommended in case there is a dispute If the tenants do not vacate the property by the end of the notice period it will be necessary to apply to the County Court for a possession order.

My tenants are in arrears with their rent You should immediately serve a "Section 8" notice on them. This notifies them that the landlord intends to apply to the court for an order requiring the tenant to give up possession of the property. At best the tenant will immediately pay the rent owing. At worst the notice starts the clock, and enables you to commence proceedings in the court after the appropriate period (normally 14 days). The following conditions must be observed: the notice must state the grounds for possession (as specified in the Housing Act) upon which you will rely in any proceedings. In cases of arrears these will normally be Ground 8 (if the arrears total more than 2 month's rent), Ground 10 (in all cases) and Ground 11 (if the tenant is persistently late paying the rent); the exact text of the ground(s) as written in the Housing Act must be used. Even if you can cite ground 8 (2 month's arrears) you should also cite ground 10 in case the tenant pays some of the arrears between receiving the notice and any court hearing the notice must be served on each tenant individually (if there are more than one) except that a married couple need only receive one copy between them the notice must be served in the correct format and it is necessary to use a standard form; this can be obtained from legal stationers a method of proving that the notice has been served (recorded delivery, independent witness) is recommended in case there is a dispute

Q: Can I get my property back?
A: If you require possession of the property you would need to give as much notice as possible, but certainly not less than 2 months. It is not normally possible to regain possession of the property within the first six months of an Assured Shorthold Tenancy. After that you can get your property back by giving 2 months notice, expiring on a monthly anniversary date of the commencement of the Tenancy. If the tenant agrees to leave (if, for instance, they are offered suitable alternative accommodation) you can get your property back at any time.

Q: Can I get my property back?
A: If you require possession of the property you would need to give as much notice as possible, but certainly not less than 2 months. It is not normally possible to regain possession of the property within the first six months of an Assured Shorthold Tenancy. After that you can get your property back by giving 2 months notice, expiring on a monthly anniversary date of the commencement of the Tenancy. If the tenant agrees to leave (if, for instance, they are offered suitable alternative accommodation) you can get your property back at any time.