SUCCESSFUL PROPERTY LETTING Also available from Constable & Robinson Getting the Builders In Internet Marketing The Right Way to Start Your Own Business Going Self-Employed: How to Start Out in Business on Your Own SUCCESSFUL PROPERTY LETTING HOW TO MAKE MONEY IN BUY-TO-LET David Lawrenson A How To Book ROBINSON First published in Great Britain in 2005 by Elliot Right Way Books This paperback edition published in Great Britain in 2015 by Robinson Copyright © David Lawrenson, 2005, 2013, 2015 The moral right of the author has been asserted All rights reserved No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form, or by any means, without the prior permission in writing of the publisher, nor be otherwise circulated in any form of binding or cover other than that in which it is published and without a similar condition including this condition being imposed on the subsequent purchaser A CIP catalogue record for this book is available from the British Library ISBN 978-1-47211-994-0 (paperback) ISBN 978-1-47211-995-7 (ebook) Robinson is an imprint of Constable & Robinson Ltd 100 Victoria Embankment London EC4Y 0DY An Hachette UK Company www.hachette.co.uk www.constablerobinson.com How To Books are published by Constable & Robinson, a part of Little Brown Book Group We welcome proposals from authors who have first-hand experience of their subjects Please set out the aims of your book, its target market and its suggested contents in an email to Nikki.Read@howtobooks.co.uk Dedication To Dagmar Svehlik, my partner, for her fantastic love and support, to Alex, our son, and to my parents Special Thanks Thanks to all those who have taken time to comment on the good work that we try to at Letting Focus and to all those who have shared their experiences of residential property investment and letting over the years Also, thanks to the Elliot brothers, who, in 2004 showed a unique and insightful faith in the original manuscript I think their faith was fully rewarded Any useful comments on the script or suggestions for future editions are welcome About the Author After university and his MBA at Cass (formerly City University) Business School, David Lawrenson worked in the financial services industry as an internal consultant and project manager whilst moonlighting as a residential landlord In 2002, he left to become a full-time property investor Then in 2005, the first edition of Successful Property Letting – How to Make Money in Buy-to-Letcame out and became the UK’s top-selling property book Lawrenson’s views on the private rented sector are quoted regularly in national newspapers like The Times, Independent and Daily Telegraph and in many specialist property magazines and on buyto-let websites He is a regular speaker at trade shows and for public and private organisations and trade associations and he runs a thriving consultancy business which helps banks, building societies, investment funds, letting agents, local authorities and housing associations develop and market their products and services for the buy-to-let and landlord markets He has advised the London Assembly and spoken at the Council of Mortgage Lenders Lawrenson also has a low-cost seminar programme and a one-to-one consultancy service for people wishing to get into buy-to-let for the first time as well as for more experienced landlords and investors His website and blog are at www.LettingFocus.com and he can be contacted at david@LettingFocus.com Contents Preface to the New Edition Financing, The Green Deal and Energy Performance Certificates, Licensing and HMOs and accreditation, Tenancy deposit schemes, Letting to tenants on housing benefit, Letting agents, Tax changes An Introduction to Property Investment Why you need this book, A brief history of residential property letting, “Landlord” or “Property Investor”, How property differs from other types of investment, When to buy? Good and bad times in the property market, Meet the people who want your money, Is it for you? What kind of person makes a successful landlord?, How much should I put in property? Easy as ABC: The Simple Economics of Property Letting Income and capital growth, How to calculate the true income from your property, How to calculate capital growth How to Find the Right Property Location, location, location: How to choose the right area, How to choose the right kind of property, Which is best: Leasehold or freehold? What questions should you ask?, Whether to buy a new or old property: Things to consider, How to buy in new developments and off-plan (and avoid the pitfalls), How to buy at auction, Does everything work? Things to check before you buy, How to negotiate successfully, Buying below market value (BMV) Ready to Buy: Finance and the Legal Stuff How to arrange your finance, How to make the conveyancing process work for you Refurbishing and Preparing Your Property How to deal with builders, How to deal with architects and surveyors, How to get planning permission and building regulations approval, How to decorate and furnish, Legal regulations: Furnishing, gas safety, electrical, EPCs, HMOs and disability, How to get the right insurance cover, Keeping everyone informed: Telling people who “need to know” How to Get the Tenancy Agreement Correct The different types of tenancy, The assured shorthold tenancy (AST) agreement: What’s in it?, What tenants need to know: The emergency and maintenance “House Guide” How to Find a Good Tenant Letting to friends and why you shouldn’t!, Getting your existing tenants to find new tenants, Letting to a social housing organisation, Using a letting agent, How to find a good letting agent, If you’re looking for a tenant yourself, How to screen potential tenants and take references, Final steps and what happens on move-in day How to Manage the Tenancy How to manage the tenants, How to manage housing-benefit/local-housing-allowance tenants, How to manage a letting agent, How to manage maintenance, How to manage a problem neighbour, How to end your tenancy, Tenancy deposit schemes, How to manage utilities and council tax, How to manage paperwork, How to keep up to date Difficult Tenants and How to Deal with Them The sorts of things that can go wrong and how to deal with them, How to evict a tenant, How to serve a notice, Possession proceedings, How to make a claim for money owed, Evicting squatters and Rent Act tenants, Whatever you do, don’t harass!, What to if a tenant dies, How to solve housing benefit/local housing allowance problems 10 When it’s Time to Sell What’s the best time of year to sell?, How to sell successfully through an estate agent, Selling at auction, Selling it yourself, Why it pays to be prepared 11 Tax Completing the tax return, All about income tax, All about capital gains tax (CGT), Tax on UK and European Economic Area (EEA) holiday lets, Tax on other foreign holiday lets outside the EEA, The rent a room scheme, All about stamp duty land tax, Investing via a property company, “SIPPS”, syndicates and “REITS” 12 Jet to Let: Diversifying Your Property Portfolio UK and EEA holiday lets, Investing in property abroad, Things you need to know – some other considerations, Where to buy and what to buy abroad, All about taxes on foreign property, Other opportunities Appendix 1: A Sample Assured Shorthold Tenancy Agreement Appendix 2: Useful Contacts Index Preface to the 2015 New Edition Over the years, many journalists and commentators have consistently and rather laughably predicted the demise of the private rented sector and of landlords’ fortunes, yet the sector continues to defy such predictions Today, almost a fifth of residential property is in the private rented sector and the proportion is far higher in places like London Private landlords, who comply with the myriad of laws and regulations, behave ethically and buy the right types of properties at the right prices and in the right areas, have continued to prosper In the future, there will be still more money to be made from letting private residential property and a lot of satisfaction to be gained from providing secure and comfortable accommodation for people to live in And, of course, it is a great alternative or add-on to a traditional pension But as the government – both local and national – intervenes ever more in the private rented sector and as sharks and unethical operators continue to be attracted by the profits available from “advising” landlords, the risks for those landlords who don’t know what they are doing have become ever greater And with a swathe of new retirees making use of new rules to access more of their pension cash, there is likely to be more grey-haired folk becoming landlords for the first time In this new edition, I explain how anyone thinking of becoming a private landlord for the first time can make a success of it But the book is also intended for established landlords too as well as new players such as institutional funds who are looking to expand into this sector Even those with years of experience and big portfolios will find plenty of useful tips here The book has been updated throughout The sections covering buying at auctions, buying repossessed property, how to get the best landlords’ insurance, mortgages, bridging finance deals and how to reference check potential tenants have all been revised once again, but there have been other changes on almost every page too – adding more tips and common sense advice throughout Some of the major revisions cover the following areas: Financing The Mortgage Market Review has made getting a residential (non-buy to let) mortgage even harder, which may lead to more people continuing to rent for longer For buy-to-let loans, lenders’ often odd criteria and strange likes and dislikes are still very much in place I will explain how the financing landscape has changed and how landlords can still get great financing deals New text has been added on bridging finance, commercial loans, private bank finance, development finance and how to maintain your credit rating The Green Deal and Energy Performance Certificates Huge changes have happened around energy saving issues that landlords need to know about so that they can still legally let their properties once the Green Deal really kicks in Appendix Useful Contacts Chapter National Landlords Association 22-26 Albert Embankment, London, SE1 7TJ Tel: 020 7840 8900 www.landlords.org.uk Residential Landlords Association Roebuck Lane, Sale, Manchester, M33 7SY Tel: 0845 666 5000 www.rla.org.uk Scottish Association for Landlords Hopetoun Gate, 8b McDonald Road, Edinburgh, EH7 4LZ Tel: 0131 564 0100 www.scottishlandlords.com Landlords’ Association for Northern Ireland 197 Lisburn Road, Belfast, BT9 7EJ Tel: 028 9082 7033 www.lani.org.uk Chapter The following are good websites for local information On all these sites you can obtain information for the specific postcode you are buying into www.homecheck.co.uk Offers reports on the risk of flooding, subsidence, radon, coal mining, landslip, landfill sites, air quality and pollution www.hometrack.co.uk (0845 013 2350) and www.rightmove.co.uk Are good for information on house prices and trends www.rightmove.co.uk Is a very easy site to use with a lot of functionality and useful information and you can chart houses prices for different types of properties in a specific postcode over time www.environment-agency.gov.uk/homeandleisure/floods/31650.aspx (03708 506 506) Has flood maps by postcodes www.hmrc.gov.uk This is the Inland Revenue’s website www.communities.gov.uk (030 3444 0000) Has lots of useful data on a wide variety of things such as house prices, rents and regeneration initiatives Land Registry www.landregistry.gov.uk Association of Residential Managing Agents (ARMA) www.arma.org.uk (020 7978 2607) Leasehold Advisory Service www.lease-advice.org (020 7383 9800) Companies House www.companieshouse.gov.uk (0303 1234 500) Website giving information on upcoming auctions: www.eigroup.co.uk Chapter Royal Institute of British Architects www.riba.org (020 7580 5533) Royal Institution of Chartered Surveyors www.rics.org (024 7686 8555) Gas Safe Register (0800 408 5500) www.gassaferegister.co.uk The Chartered Institute of Plumbing and Heating Engineering (IPHE) www.ciphe.org.uk (01708 472 791) The Association of Plumbing and Heating Contractors (APHC) www.aphc.co.uk (0121 711 5030) National Inspection Council for Electrical Installation Contracting www.niceic.org.uk (0870 013 0382) Electrical Contractors’ Association (ECA) www.eca.co.uk (020 7313 4800) Chapter Royal Mail www.royalmail.com (0845 774 0740) Chapter For IPHE, APHC – see Chapter above For ARMA see Chapter above Energy Saving Trust www.est.co.uk (0300 123 1234) England 020 7222 0101 Wales 029 2046 8340 Scotland 0131 555 7900 Northern Ireland 028 9072 6006 www.boilers.co.uk The Energy Saving Trust’s website offers useful help including a range of grants that may be available With the site boilers.co.uk, you can type in what your specific needs are, size of home, energy source, etc, and the site will come up with suggestions starting with the most efficient model and information on grant availability For Land Registry – see Chapter above Oyez Stationers www.oyezforms.co.uk www.landlordzone.co.uk (0845 260 4420) www.landlordlaw.co.uk www.lettingfocus.com – my own website with a regularly updated blog Chapter For Oyez Stationers, see Chapter above Courts Service www.hmcourts-service.gov.uk Chapter 10 Inland Revenue www.hmrc.gov.uk or contact local tax office Index abroad see overseas property investment accelerated possession procedure 189, 200–1 access to the property 209 accidental damage insurance 108, 110, 162 accreditation schemes 13, 106, 193 administration 24, 26, 111–12 see also management advertising 34, 136–43, 162–3 architects 93, 94, 242 assured shorthold tenancies (AST) 64, 72, 113–14, 116–19 agreement 118–19, 249–59 deposits 119 early-vacating tenants 117–18 ending a tenancy 180–8, 197–8 eviction see eviction fixed terms 116, 118, 180, 197 guarantors 117 monthly periodic tenancy 116, 118, 197 more than one tenant 116–17 rent reviews 119 unfair terms 117 assured tenancies (AT) 64, 114, 190, 209 auction, buying at 61–7 completion 66 deposits 63, 65 finance 67 guide prices 63 “hawking” 66 paperwork 64 pre-auction offers to buy 66 reserve prices 62, 66 viewing a property 65 auction, selling at 214 bad debts 33, 222 see also rent, arrears bailiffs 201, 204, 209 bank loans see loans bank statements (tenants’) 152, 155, 157 bank status enquiries 157 banker’s drafts 164 base-rate tracker mortgages 80 bathrooms 96–7, 104 below market value (BMV) properties 23, 69–74 sourcers 70 boilers 173, 174–5 bridging loans 67, 71, 84–5 closed bridges 85 open bridges 85 building regulations 65, 94 Building Regulations Approval Certificate 94 building society drafts 164 building surveyors 93 building work 89–95 architects 93, 94 cash payments 92 contracts 91–2 detailed specifications 65, 89–90, 91, 93 estimates 89 finding a good builder 89, 90–1 fixed quotes 65, 89, 90 planning permission 94 snagging 91 timescale 91 trade accounts 92 VAT 92 see also tradesmen buildings insurance 32, 33, 107–8, 109 buy-to-let mortgage see mortgages buying a property see finding and buying a property buying agents 22, 55, 58, 59–60 buying clubs see syndicates “buying for income” 45 “buying for yield” 45 “cap and collar” mortgages 78 capital allowances 224, 230 capital gains tax (CGT) 39, 40, 54, 218, 223–30, 233, 234, 235 annual exemption 228–9, 234 calculation 224–9 principal private residence (PPR) exemption 225–6, 227–8, 229, 233, 235 private letting relief (PLR) exemption 225, 226–8, 235 rates of 229–30 capital growth 29, 41, 45, 46, 95 calculation 38–40 carbon-monoxide detectors 101 carpeting 96 cash buyers 69 co-mortgages 77 commonhold 51 communal hallways 50, 188 communication skills 24 company lets 100, 114–15, 138, 140, 159–60 company tenancies 114–15 management of 166 references 158–60 competition, checking out 30 completion statements 88 condensation 122, 176, 177 contents insurance 33, 108, 162 conveyancers 86 auction-experienced 64, 66 conveyancing 85–8 leasehold properties 87 Scotland 85 corporation tax 218, 235 costs of total investment 35–8, 39 council tax 31, 111, 191 County Court Judgments (CCJs) 78–9, 156, 203, 204 credit reference checks 155–7 credit scores 78–9, 156 curtains and fittings 95 damp 53, 123, 176–7, 195 death of a tenant 207 decoration see furnishings and decoration demand for rental accommodation 19–20, 21 demographic trends 46 deposits amount of 147 assured shorthold tenancies (AST) 119 payment of 164 property purchase 77, 88 return of 182, 186, 187, 202 see also tenancy deposit schemes derelict properties 47, 83 development finance 84 diplomatic immunity 115, 159 disability adaptations 107 discounted mortgages 79 dishwashers 123 disputes see problem neighbours; problem tenants “distressed sales” 62, 70, 72 drainage 122, 123, 175–6 economic downturns 21, 27 electrical problems 177 electrical safety regulations 101–2, 171 electricity fuse boards 67 emergencies 108, 120, 123, 165, 172 insurance cover 108, 123, 173 see also House Guide employer references 150–3 ending a tenancy 180–8 belongings, abandoned 188 cleaning 184–5 giving notice 180–1, 182 inventory checks 185, 186 return of deposit 182, 186, 187 Section 21 notices 181, 197–8 Energy Performance Certificates (EPCs) 34, 35, 88, 102–3, 175, 193 energy saving schemes 103 Enterprise Investment Schemes 231, 236 estate agents 67, 68 online agents 212 relationships with 43 selling property through 212–14 European Economic Area (EEA) holiday lets 230–1, 237 eviction 34, 109, 196–200 assured shorthold tenancies (AST) 117 assured tenancies (AT) 209 court action see possession proceedings discretionary grounds for 197, 198 holiday lets 116 mandatory grounds for 197–9 possession proceedings 200–2 Rent Act tenants 114, 206 serving a notice 199 squatters 204–6 unlawful 181 ex-council properties 45–6, 83 ex-government housing 62 Exchange with Delayed Completion (EDC) 73 extractor fans 122, 176, 177 “fair rent” 114 finance see loans; mortgages finding a good tenant 125–64 advertising 34, 136–43 gut feeling 153, 158–9 references 149–58 screening 26, 143–6 specifying the type of tenant 141 see also letting agents; referencing finding and buying a property 41–74 buying at auction 61–7 buying below market value (BMV) 69–74 “buying for yield”/”buying for income” 45 choosing the right kind of property 44–7 leasehold/freehold 47–52 local information 21, 42–3 location 41–3 negotiation 68–9 new or old 52–6 new-build and off-plan 52–61 pre-purchase checklist 67–8 fire safety smoke detectors 102, 123, 177 soft furnishings 100–1 flats above shops 45, 83 basement and ground-floor flats 46–7 buying at auction 65 communal hallways 50, 188 conversions 50, 176 ex-council flats 46 floor plans 59 insurance 107, 109 leasehold 47–52 managing agents 173, 174, 178 “mansion type” blocks 46 mortgages 49, 83 new-build 50–1, 56, 57, 59 paperwork, managing 191–2 problem neighbours 178 service charges 32, 46, 47, 49, 50–1, 57 short lets 111 water leaks 122, 123–4, 144, 173–4, 179 Flips for Free 73 flood risk areas 83, 110 flooring 96 foreign nationals, letting to 115, 157, 159 forwarding addresses 187, 190, 191 friends, letting to 125–6 furnishings and decoration 95–100, 129, 140–1, 148, 191 fully furnished lets 100 legal regulations 100–1 quality 33, 41, 95 replacement costs 33 wear-and-tear tax allowance 221–2 garden maintenance 97–8, 195 gas appliances 33–4, 101, 171, 173 gas leaks 122 gas shut-off valve 122, 124 Google Street View 43 Green Deal 12, 103 ground rent 32, 47, 49 guarantors 115, 117, 150, 158, 163, 195 harassment 151, 206–7 “hawking” 66 head lease schemes 163 heating 173, 174–5 history of residential property letting 16–17 holiday lets 116, 137, 198, 237–41 abroad 230–1, 237–8, 240–2 European Economic Area (EEA) 230–1, 237 loans and mortgages 238 longer-term tenants 241–2 running costs 238, 242 tax treatment 230–2, 237 Home Information Packs (HIPs) 215 House Guide 113, 120–4, 165, 170 house prices 19, 20, 21, 46 house shares 160 see also Houses in Multiple Occupation (HMOs) house-building programme 19 Houses in Multiple Occupation (HMOs) 103–6, 108, 119, 160, 193 conversion to 106 management 169 mortgages 105 Housing Association Leasing Schemes (HALS) 127 housing associations 126 Housing Health and Safety Rating System (HHSRS) 104, 106 housing supply 19, 46 housing-benefit tenants 13, 20, 108, 127, 141, 150, 160–1, 186–7 management of 166–8, 195–6 overpayment claims 167, 187, 207 problems with 160, 207–8 identity fraud 50, 112 illegal activities, tenants’ 208 income see yield income tax 39, 54, 81, 218, 219–23 deductible expenses 27–8, 220–3 rates of 223 inheritance tax 218 inspection visits 165, 168, 170 insurance 107–11 accidental damage insurance 108, 110, 162 appliance cover 177 auction properties 64, 65 buildings insurance 32, 33, 107–8, 109 claims 110 contents insurance 33, 108, 162 emergency assistance feature 108, 123, 173 empty properties 31 excesses, standard 109 exclusions 108–9 flats 107, 109 flood risk areas 110 leasehold properties 32 overseas property 243–4 premiums 33 public and employer’s liability insurance 108 rent guarantee insurance 109 tenancy deposit protection 33, 34, 133, 188–90 tenant default 33 water damage 121–2 interest-only mortgages 80–1 inventories 129–30, 148, 162, 185, 186 inventory clerks 129–30, 162, 186, 190 investment clubs 22 investment, sensible limits of 26–7 “jet to let” 237–48 Joint Venture deals 23, 73–4 kerb appeal 97 kitchens 96 Land and Building Transaction Tax 233 Land Registry 47, 87, 155 landlords accreditation schemes 13, 106, 193 negative associations 17 organisations 34–5, 129, 192–3, 201 registration (Scotland and Wales) 34 successful landlords 22–6 Landlords’ Energy Saving Allowance (LESA) 103, 175, 223 leafleting 47, 70 leaks see water damage leaseback schemes 241 Leasehold Advisory Service 51 leasehold properties 47–52 buying the freehold 47 checking the lease 49–50 commonhold 51 conveyancing 87 extending the lease 49 ground rent 32, 49 management 47, 49, 51 mortgages 49 service charges 32, 46, 47, 49, 50–1 see also flats leaving day 185–6 legal expenses 34 letting agents 127–35, 163 chancers 142 contracts 133–4 deposits, handling 134, 169, 190 drawbacks 130–2 fees 32, 118, 128, 131–2 fidelity bonding schemes 134, 169 finding a good agent 133–5 management of 168–70 management services 32, 165, 168–9, 170, 172 ombudsman schemes 13, 134, 169 online agents 130, 136–7 relationships with 24, 44, 168–70 role and services 26, 32, 127–8, 129–30 tenant charges 132, 147 LIBOR rates 83 licence to occupy 115–16 licensing schemes 13, 34, 103–5, 193 limited companies 235 listed properties 53 loans 28, 83 bridging loans 67, 71, 84–5 foreign properties 243 tax deductible 27–8, 220–1, 234 see also mortgages local housing allowance (LHA) 166, 207 local knowledge 21, 42–3 location 41–3, 138–9 locks, changing 68, 201 lodgers 115–16 London Rental Standard 13, 106 losses, rental 222, 230–1 maintenance by letting agents 168–9 costs 33–4 “Home Emergencies” contracts 172–3 House Guide 113, 120–4 legal obligations 171 management 171–7 minor repairs 120 tax-deductible costs 222, 234 malicious damage 109, 151 management deposits see tenancy deposit schemes ending a tenancy 180–8 of letting agents 168–70 maintenance 171–7 paperwork 191–2 problem neighbours 177–9 tenants 165–8 utilities and council tax 190–1 manholes 67–8, 176 meter readings 111, 129, 162, 186, 191 migrant workers 19, 44 mixed tenure developments 59 mortgage brokers 81, 243 mortgage fraud 73 Mortgage Market Review 12, 76 mortgages 37, 75–84 additional advances 82 ancillary charges 76 application fees 77 base-rate tracker mortgages 80 blanket restrictions 76, 83 “cap and collar” mortgages 78 co-mortgages 77 discounted mortgages 79 early redemption penalties 79–80 ex-council properties 46 fixed-rate mortgages 78 flats 49, 83 Houses in Multiple Occupation (HMOs) 105 interest rates 38, 82, 83 interest-only mortgages 80–1 leasehold properties 49 loan to value 77 new-build schemes 56 one-off capital repayments 82 “rent to interest” restriction 77 repayment mortgages 80, 81 self-certified mortgages 81 surveys 78 tax deductible 221 valuation reports 53, 78 variable-rate mortgages 79 move-in day 161–2, 164 National Insurance Contributions 218, 233, 234 National Insurance numbers 158 National Landlords Association 35 neighbours, problem 177–9 new-build properties 23, 52–61 city centres 53–4, 56 discounts 58, 60 flats 50–1 guarantee schemes 61 guaranteed rental yields 58, 59 “mixed tenure” developments 59 mortgages 56 off-plan schemes 23, 54–5, 57, 61 snags 52–3, 61 sweeteners 58–9 tenants’ ghettos 57, 59 valuation 56 “next-day remortgages” 71 nil cash flow situations 82 see also void periods notice, giving 180–1, 182 off-plan schemes 23, 54, 57 back-to-back sales 54–5, 61 goodwill deposits 54 opportunity costs 36–7 overseas property investment 238–48 exchange rates 243 finance 243 holiday homes 240–2 holiday lets 230–1, 237–8, 240–2 insurance 243–4 off-plan schemes 23 tax treatment 246–8 where and what to buy 244–6 own home letting out 82, 110, 111–12, 198–9, 233–4 lodgers 115–16 re-occupation 198–9, 205 painting 97, 195 paperwork, managing 24, 26, 191–2 parking facilities 46, 57–8, 140 pensions, and property investment, compared 18 periodic tenancies 116, 118, 197 pest problems 177 pets 163 planning permission 53, 64–5, 94, 106 portfolio diversification 46, 237–48 possession proceedings 115, 151, 200–2, 208–9 accelerated possession 189, 200–1 normal possession 201 online applications 210 possession orders 181, 182, 197, 199, 200, 201, 205 using a solicitor 202 premium rents 31, 98, 115, 166 privacy, tenants’ 99, 187 Private Sector Leasing Schemes (PSLS) 127 probate sales 62, 64 problem neighbours 177–9 problem tenants 34, 151–2, 165, 194–210 claims for money owed 151–2, 198, 201, 202–4, 209–10 death of a tenant 207 harassment, avoidance of 151, 206–7 housing benefit/local housing allowance problems 207–8 managing problems 194–6 squatters 204–6 see also eviction proof-of-posting certificates 182, 199 property development 235 property funds 20, 26–7 exit fees 27 property investment companies 25, 235, 246–7 Property Lease Options 73 property shows 193 Protected Intending Occupier (PIO) 205 public and employer’s liability insurance 108 quantity surveyors 93 Rachmanism 16, 17 Real Estate Investment Trusts (REITS) 20, 236 referencing 132, 141, 149–58, 206 bank statements 152, 155, 157 bank status enquiries 157 company lets 159 credit reference checks 155–7, 203–4 employer references 150–3 guarantors 117 house shares 160 landlords (tenants’ references) 187 previous landlord references 153–5 proof of identity 155 self-employed people 152–3 verifying references 152, 154, 155 work permits 157 regeneration areas 42, 58, 73 regulatory costs 34 relocation agents 115 remortgages 71, 85, 220, 234 rent 20, 26, 142, 147 arrears 166–7, 198, 200, 201, 208 late payment of 165, 195, 196, 198 reductions and waivers 171–2 rent guarantee insurance 109 reviews 119 setting a rent 30–1, 129 standing orders 162 unpaid rent 33, 34, 151 Rent Act tenancies 16, 62, 64, 114, 206 Rent to Rent schemes 73 rent-a-room scheme 232 repairs see maintenance repayment mortgages 80, 81 repossessions 62, 64, 67 reservation fees 161, 164 Residential Landlords Association 35 Rightmove 34, 42–3, 58, 98, 130, 136, 212 Price Comparison Report 58 risk 28 rogue landlords 13, 16, 104, 105 rollover relief 230 running costs 29, 32–5, 37 advertising 34 general maintenance 33–4 ground rent 32 insurance premiums 33 landlords’ organisation fees 34–5 legal and other regulatory expenses 34 letting agency fees 32 personal costs 35 replacement fixtures and fittings 33 service charges 32 Sale and Rent Back (SARB) 72 Scotland conveyancing 85 gas safety regulations 101 Houses in Multiple Occupation (HMOs) 105 selling property 215 short assured tenancy 113 stamp duty land tax 233 tenancy information pack 113, 119 screening tenants 23, 143–6 sealed bids 69 seasonality of the rental market 137–8, 163 Section notices 198, 199, 208 Section 21 notices 181, 199, 200, 208 Seed Enterprise Investment Schemes 231 selective licensing schemes 104, 105 Self Invested Personal Pension Schemes (SIPPS) 236 self-certified mortgages 81 self-employed tenants 152–3, 158 selling property 211–16 at auction 214 costs 211 Home Information Packs (HIPs) 215 Scotland 215 selling it yourself 214–16 through an estate agent 212–14 timing the sale 211–12 seminars, property investment 22, 23, 193 service charges 32, 47, 49, 50–1 ex-council properties 46 new-build schemes 57 set-up costs 36 shared ownership schemes 59 short assured tenancy (Scotland) 113 showers 93, 97, 123, 140, 144 sitting tenants 64, 87, 114 small claims procedure 90, 202–3 smoke detectors 102, 123, 177 social housing tenants 19, 25, 59, 108, 126–7 soft furnishings regulations 100–1 solicitors 55, 202, 242 squatters 188 eviction 204–6 stamp duty land tax 218, 232–3 stock market, and property investment, compared 18 stop valve (stop cock) 67, 122, 123, 124 structural engineers 94 students 19, 105, 108, 136, 137, 156, 158, 163, 195, 248 subletting 200 subsidence 62, 64, 65, 93–4, 109 surveys auction properties 65 building surveyors 93 full structural surveys 53, 78 quantity surveyors 93 structural surveyors 93 valuation reports 53, 78 syndicates 23, 24, 55–6, 58, 59–60, 236 tax 217–36 double tax relief 247 holiday lets 230–2 managing paperwork 192 non-UK residents 218, 233 overseas property 246–8 rent-a-room scheme 232 SIPPS, syndicates and REITS 236 tax returns 218–19 see also capital gains tax (CGT); corporation tax; income tax; inheritance tax; National Insurance Contributions; stamp duty land tax tenancies ending a tenancy 180–8 see also assured shorthold tenancies (AST); assured tenancies (AT); company tenancies; Rent Act tenancies; short assured tenancy (Scotland) tenancy agreements 35, 113–20, 129, 164 draft copies 161 sample agreement (Assured Shorthold Tenancy) 249–59 tenancy deposit schemes 13, 35, 114, 134, 188–90 custodial schemes 188, 189 dispute-resolution procedures 188, 189, 202 insurance-based schemes 34, 133, 188–90 tenancy information pack (Scotland) 113, 119 tenants eviction see eviction letting to friends 125–6 management of 165–8 relationships with 24 see also company lets; finding a good tenant; holiday lets; housing-benefit tenants; social housing tenants; students time-share schemes 241 To Let boards 188 tracing agents 203, 210 tracker mortgages 80 tradesmen emergency call-outs 123, 171 legal action against 90 relationships with 24, 171 service-level agreements 171 trade body membership 89 see also building work trading losses 222, 230–1 transport facilities 43, 140, 144 tumble driers 177 Universal Credit 13, 161, 166 unlet properties see void periods utility bills 111, 119, 190–1 valuation reports 53, 78 variable-rate mortgages 79 viewings 99, 139, 145–9 tenants’ privacy 99, 187 void periods 26, 30, 31, 130, 132, 149, 162 council tax 31 insurance 31 property security 187–8, 215 washing machines 123, 141, 177 water damage 121, 122, 123–4, 144, 172 damage to other properties 121, 122, 144, 173–4, 179 water stop valves 67, 122, 123, 124, 176 white goods 96, 98, 140–1, 170, 177 appliance cover 177 work permits 157 yield 29–30, 38, 39, 41, 46 “buying for yield” 45 calculation 30, 36 effect of voids on 31 guaranteed rental yields 59 net yield 37, 38 Zoopla 34, 130, 136, 212 ... How to Start Out in Business on Your Own SUCCESSFUL PROPERTY LETTING HOW TO MAKE MONEY IN BUY -TO- LET David Lawrenson A How To Book ROBINSON First published in Great Britain in 2005 by Elliot... become a full-time property investor Then in 2005, the first edition of Successful Property Letting – How to Make Money in Buy -to- Letcame out and became the UK’s top-selling property book Lawrenson’s... tenants to find new tenants, Letting to a social housing organisation, Using a letting agent, How to find a good letting agent, If you’re looking for a tenant yourself, How to screen potential tenants