With property prices skyrocketing and estimated to rise by 13.7% annually, the residential housing market in the UK is booming. This provides the perfect opportunity for people looking to make significant investments in residential property.
With a steady increase in the value of properties, people in the UK have started to ‘put their money where their house is’. Whilst many properties are purchased as vacant possessions, there will be circumstances where a property is being sold with a tenant already in situ.
This shouldn’t hinder your investment. In fact, it should mean that you are deriving an income and return on your investment immediately. Certain considerations, therefore, need to be kept in mind. Here’s a quick guide for the investors looking to buy a property with an existing tenancy in operation.
Go Over the Tenancy Agreement
The first and foremost step for potential landlords should be to go through the tenancy agreement thoroughly. This will alert them to all of the terms regarding the tenancy, such as the date it started, the rental value, the date when payments are due, the value of the deposit paid by the tenant and other terms regarding the tenancy.
Make sure you familiarize yourself with the existing clauses to ensure you understand your obligation and those of the tenant. If thereis something that you do not understand or possibly disagree with then raise these with your conveyancing solicitor.
Know Your Landlord Obligations
Before making such a significant investment, make sure you know exactly what you’re getting yourself into. A landlord has a lot of responsibility towards its tenants. Landlord obligations focus on providing a safe environment for the tenant. There will be many obligations which may not be covered in the tenancy agreement and therefore it is your interest to familiarize yourself with the relevant such as the Housing Act and the Landlord and Tenant Act.
There are specific obligations to do with deposit registration, information for renting, energy performance and fire safety. It is essential youensure there arevalid gas and electrical safety certificates are in operation, fixtures and structural elements are intact, the property is kept free from rodents and pests, etc. The bulk of the documents associated with these activities must be served on your tenant in a timely manner.
While the former landlord might be up to speed with everything, it doesn’t hurt to recheck before buying and familiarize yourself with everything since ‘it will not be acceptable to place the blame for any shortcomings at the feet of the former landlord once you have taken ownership.
Examine the Property Closely
One of the landlord’s duties includes repairing any broken fixtures or structural defects on the property. While the landlord can protect himself from certain unforeseen events that may result in high expenditure with landlord’s insurance, there are some expenses that he will need to bear.
The smart thing to do before taking ownership is to closely examine the property and identify any structural damages or defects which may impact the tenant’s ongoing safety and enjoyment of the property.
Before making such a significant investment, it’s best to consult a property expert or solicitor. Landlord Assist comprises a panel of property specialists and has access to solicitors with an extensive knowledge of Landlord Services UK and tenant related matters which include compliance, tenancy agreements, deposit registration, tenant eviction and much more
Contact us to make sure you go into every property investment armed with the information needed to maximize your experience and return.