Legal
Recent years have seen a big rise in the amount of legislation
associated with the buy to let market. The situation regarding new laws
is very dynamic. It is very important to remain well informed.
Buy2LetExpert utilise their solicitors and are members of a trade
association who continually update on such matters as legal issues. A
few key issues are highlighted below:
- Contracts. It is very important to choose the right kind
of contract. Legislation changes in October 2010 now mean that all
buy to let tenancy contracts for rents under £100,000 per annum
should be Assured Shorthold Tenancy agreements. While not
complicated documents, it is important that they are completed
correctly and everything is done 'by the book'. Buy2LetExpert can
advise on the details and how to tailor the contract including
specific clauses required by the landlord or property in question.
- Late, Partial or Non Rental Payment. Strict procedures
should be followed should there have been a breach of contract. For
property repossession, appropriate forms must be completed and
delivered in an appropriate manner. Forms must be delivered after
minimum periods etc. It is a costly and time consuming process and
best avoided if at all possible. Careful adherence to the
Buy2LetExpert advice will minimise the likelihood of the requirement
for legal repossession.
In almost 20 years no Buy2LetExpert property has ever been
repossessed. Furthermore no tenant has ever vacated with outstanding
debt.
- EPC, Gas Safety and PAT Tests. Energy Performance
Certificates (EPC’s) are now required by law when marketing a buy to
let property and should be available to the potential tenant. They
attempt to measure the property in terms of its energy efficiency so
that different properties can be compared. It highlights issues such
as inefficient boilers and areas where insulation might be
substandard. It also recommends improvement that might be made.
Currently, EPC’s are valid for 10 years regardless of what
improvements are made. So, in theory, it may be beneficial to repeat
the EPC if for example old boilers are changed, roof insulation
added or windows replaced with double glazed units. An EPC test
typically costs around £50. A quick 'google' will reveal many
providers of the service. There is no pass or fail on an EPC check
but merely a score.
Gas Safety Checks are also a Legal Requirement but should be
carried out on an annual basis by a 'Gas Safe' registered heating
engineer on all gas appliances such as boiler, hob etc). The
property must pass a test to receive a valid certificate. There are
doubtless many excellent engineers but sometimes a very small factor
can result in a fail and re visit. Buy2LetExpert attempts and
usually can anticipate the problem issues that are often quickly
rectified BEFORE the visit saving repeat visit cost. A typical cost
for an inspection is £65 with an additional £40 or so for a repeat
visit.
Portable Appliance Checks (PAT checks) are not a legal
requirement but are advised. They relate to an electrical test on
all portable appliances provided by the landlord. So examples would
be toasters, kettles, irons, coffee machines etc etc. Buy2LetExpert
would strongly advise NOT to supply portable appliances otherwise
there will be a cost associated with testing the appliance. If a
tenant demands a kettle or two then simple make a 'gift' of such
items and get the acceptance of the gift signed in writing! This
minimises the portable appliances but any remaining (e.g. vacuum
cleaners) can be checked by Buy2LetExpert at the time of the annual
gas safety check at no additional cost.
- Fire Retardant Fabrics. All soft furnishings (including
mattresses) much display the appropriate fire test certificate if to
be included in a let property. Be careful with older
furniture (not antiques) which are unlikely to conform.
- Tenancy Deposit Scheme. It is a legal requirement that
all tenant deposits must be registered with a quasi government
organisation. The issues of
the
inventory itself is discussed
within the Tenant Management section. It is very important that the
inventory is carried out correctly prior to registering the deposit.
However, once the deposit is registered, the tenant (and landlord)
can call upon the services of an independent arbitrator to settle
any disputes.
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