Letting a property
Renting out your property may seem like an easy source of income, but if you do not understand your responsibilities you may face legal problems.
Before you start to look for a tenant, read the government’s guide on how to let.
Once you've decided you’d like to rent out your property, you should talk to a solicitor.
An experienced and skilled solicitor will act in your best interests and protect you if anything goes wrong. The best way to avoid problems is to get the right legal advice at the start.
A solicitor can:
- explain the different types of tenancy
- identify the most suitable tenancy for you
- draw up and explain your agreement
- warn you of any pitfalls
- advise you on asking for tenant references
Use the quick search option "Landlord and tenant – residential" to find your nearest solicitor.
The cost will vary between solicitors. Check with a few local solicitors to compare their prices before you decide who to use.
The cost will depend on:
- the solicitor’s experience and knowledge
- the type of tenancy you want
- the complexity of the agreement
Before the tenancy begins, you must:
- give your tenant a copy of the government’s how to rent guide
- check your tenant has the right to rent
- install smoke and carbon monoxide alarms
- protect your tenant’s deposit in a deposit protection scheme
- give your tenant copies of the gas safety and Energy Performance certificates
A tenancy agreement is a contract between you and your tenant. It can be written or verbal.
You do not have to use a written agreement, but it's a good idea to have one. This will help if your tenant disputes the terms of the agreement later.
Drawing up your agreement
Once you’ve chosen a solicitor, they’ll explain your rights and responsibilities as a landlord.
You should discuss your needs and any concerns you have. This will help your solicitor draw up a tenancy agreement that’s right for you.
Length and type of tenancy
Your solicitor will ask you to think about:
- the type of tenancy
- the number of tenants
- how long the tenancy will last
If you're a private landlord, your solicitor will probably recommend that you use an assured shorthold tenancy.
These can last for a fixed term (for example, one year) or a shorter period that gets rolled over (for example, month to month) until you or your tenant want it to end.
You may want to include restrictions in your lease. These are terms that stop your tenants from doing certain things. These could include:
- playing loud music
- painting the walls
- keeping pets
If these restrictions are reasonable, your solicitor can include them in your tenancy agreement.
Rent and service charges
You should talk to your solicitor about:
- the amount you should charge
- penalties for late rent
- when you can increase rent
You should decide who will pay bills and council tax.
You should decide whether you’ll provide any services, such as laundry, maintenance of the property or meals. You can ask your tenants to pay a separate service charge as well as rent.
You may want to ask your tenant for a deposit before they move in. This will help you pay for any damage or unpaid bills at the end of the tenancy.
You cannot ask your tenant for more than five weeks’ rent if the annual rent is less than £50,000. If the annual rent is £50,000 or more, the deposit can be up to six weeks’ rent.
All deposits must be held in one of three government-approved tenancy deposit schemes:
You must tell your tenant in writing which scheme is holding their deposit within 30 days of receiving it. If you do not do this, you can be taken to court and fined.
It’s a good idea to include an inventory list of fixtures and fittings with the tenancy agreement as a record of your property’s condition at the start of the tenancy.
Ask your solicitor what your rights to enter the property are.
You’ll usually need to give your tenant at least 24 hours’ notice before visiting your property (unless there’s an emergency).
Once you have a tenancy agreement, make sure that both you and your tenant sign it at the start of the tenancy. You must give your tenant a written copy if they ask for it.
During the tenancy, you must make sure your property:
- is safe and in good repair
- has a working supply of water, gas, electricity and heating
- is fit for human habitation
You’re also responsible for carrying out most repairs and building maintenance.
You may face legal action if you breach your duties to your tenant.
Speak to your solicitor if you want your tenant to leave before the end of the tenancy.
You could be found guilty of harassing or illegally evicting your tenant if you do not follow the correct process. Your solicitor will:
- explain what you need to do
- guide you through the process
You must give your tenant written notice asking them to leave your property.
Make sure your tenant has paid any rent or bills due before the end of the tenancy.
Once the tenancy has ended, you must return the deposit to the tenant. You can make a deduction from the deposit if your tenant:
- damaged your property
- left bills unpaid
You must be able to prove your claim and you cannot deduct for reasonable wear and tear.
If your tenant disagrees with the amount you’ve deducted, they can make a claim with your deposit protection scheme.