Don’t get caught out and fined because of lack of knowledge
Over the last couple of years, the government has seemed intent on adding to the regulatory burden of buy-to-let landlords. Maybe they are considered an easy target, a little like drivers. Whether the added regulations have been a conscious revenue-enhancing exercise is a moot point. The fact is that if you don’t conform to these regulations, you could be fined thousands of pounds – usually by the local authority in which your investment property is located.
In this article, you’ll learn about seven of the regulations that could cost you dearly if you don’t comply with them – whether by design or not.
1. Right to rent laws
You are obliged to check that your applicant has a right to rent in the UK. If you rent to someone who doesn’t have the right to rent, you could be fined up to £3,000.
Letting agents should do this job for you. Check that they do. If they don’t, or you are a DIY buy-to-let landlord, then you must do the check yourself. Read our article “Avoid buy-to-let landlord fines by knowing right to rent rules” for more information.
2. Safety of your tenants
There is a raft of rules, regulations, and laws that oblige you to ensure the safety of your tenants (and visitors) to your investment property. And it is serious stuff. If a tenant is injured on your property and they can prove it is because of your negligence, you could be sued for thousands. Here are a few tips:
- Make sure your landlord insurance covers you for this, as well as rent arrears, damage, and public liability
- Ensure you have a valid gas safety certificate
- Make certain that your property is inhabitable (think insulation, etc.)
- Have your electric appliances tested
- Make sure smoke alarms work (assuming you don’t want a £5,000 fine)
3. Energy efficiency laws
Most rental properties must have energy efficiency certificates, to comply with the new Minimum Energy Efficiency Standards (MEES). Your property must have a minimum E rating – applied first to new tenancies and renewals. By 2020, all tenancies must be at least E-rated. Again, break the rules and you could be hit with a £5,000 fine.
4. Tenancy deposit protection
If you ask for a security deposit from your tenant, then it must be handled correctly and deposited in a tenancy deposit protection account. Don’t think you can do this yourself. If you keep your tenant deposit, even in a separate account that you never access, you could be sent to prison – and pay thousands in fines.
5. Get licensed as a landlord
Increasingly, local authorities are introducing landlord licensing. To become licensed, your properties will need to pass certain minimum standards. If you let a property without being licensed, expect to be fined heavily. We expect cash-strapped local authorities to get hot on fining unlicensed landlords. You’ve been warned! Check on the local authority website to see if landlord licensing applies to you.
6. Always evict lawfully
It’s tempting to kick out a poor tenant, or one who is in rent arrears. Avoid the temptation to use strong-arm tactics. If you want to remove a tenant, you must follow the tenant eviction law, and do so by issuing a Section 21 or Section 8 Notice, or by applying for an accelerated possession order. Whatever you do, always take legal advice.
7. Council tax bills while your property is empty
In 2017, the government announced that local authorities could charge a council tax premium of 100% of the council tax charge for empty properties. To avoid the need to pay council tax on an empty property, get it rented! For help in finding the very best tenants, contact one of our team today on +44 01522 503 717.
Live with passion,