Renting a property - any advice on how to avoid major pitfalls?

We were extremely lucky. A flat above the office where I worked came on the market. My employers (a charity) were looking to expand but could not get a grant to purchase. meantime DH reached retirement age and received substantial funds from an endowment policy, so we bought the flat and rented it to the Charity. Some years later the adjacent bigger flat was for sale or rent and the Charity rented it, leaving us with an empty flat.

At this time there was a change to the rules for rental landlords. The local council organised an evening meeting to explain the changes for landlords. DD and I attended. At the end of the meeting the Council's head of housing explained that the Council urgently needed 'scatter flats' for homeless persons if anyone had suitable properties. We talked to him, he visited our flat, said it was perfect for their purpose and long story short, we rented the flat to the Council. They dealt with the tenancies, inspected and refurbed and paid us directly each month at the then rental rate for tenants on benefits - We had no direct contact with the tenants - Win Win.

When we eventually needed a cash sum (for DD's new home) we sold the flat for 3x what we had paid for it.

We let our house in London for 18 years when we went to the Netherlands. We let it furnished but used a reliable estate agent who vetted tenants and ensured the upkeep as we were abroad.
At first they only let to foreigners as they said they were bound to leave in the end but latterly we had an English family living there for the last 10 years. When we gave them notice that we were coming back they left without a problem.

Our tenants were always families who I think possibly treat the place better.

My DD let her flat in London for 5 years and also employed an agent. At one stage she had 5 nurses living in it and she used to send them food parcels as it was during the pandemic. She didn't really have any problems either.

You just need to bear in mind that it will be a business and no longer your holiday home.
Emotional attachments need to put to one side or you are bound to be disappointed, upset etc by the way the tenants live.

In your contract you may stipulate no children, pets, smoking etc, don’t be surprised if your tenants circumstances change …….

Dinahmo

Some friends bought a nice house in a nice Suffolk town to let out. They chose not to use an agent. The man who rented it paid the first few months rent and then stopped. He was apparently comfortably off and had a BMW. He stopped paying the rent and it took several months and solicitors to get him out.

Same happened for a friend in Devon. A nightmare.

Oh yes, would do it ourselves if we were close at hand.

I've let property for years and never used an agent, but then the property is part of our main residence anyway, so we are always on hand to deal with any issues. If you don't live near the property, then yes, I would use an agent.

We have let our flats and used a reputable high street agent to do all the legal, vetting, but we did the maintenance ourselves. We found letting to single men was problematic. One didn’t pay his rent and came up with wild excuses. The other left the flat filthy when he vacated. We then let only to women and we had no problems, in fact one has been in hers for 10 years.

Some friends bought a nice house in a nice Suffolk town to let out. They chose not to use an agent. The man who rented it paid the first few months rent and then stopped. He was apparently comfortably off and had a BMW. He stopped paying the rent and it took several months and solicitors to get him out.

I’m about to let out my rental property again, after the last tenant left in September. I’d hoped to sell it, but the market there is poor, despite only asking what I’d paid for it in 2011. It’s been completely redecorated throughout and after replacing 20 lightbulbs and a carbon monoxide monitor last weekend, it’s almost ready to go, although a holdup was that I had to get a new EICR as the property’s more than 10 years old now.
This time, I’m using a local agent as a ‘Tenant Finder’. I have a small mortgage on it, but there’s no tax allowance now, so I have to pay tax on the entire income. I’ve my fingers crossed for good tenants who want to stay long term - the last ones stayed 8 years, but hardly ever paid their rent on time and fell seriously behind during Covid.

Like Sago my friend used to let her home via an agency that only let to short-term business people (3-9 months) relocating or coming in on short contracts from other parts of the (global) businesses. It was their UK home and they let it furnished including some antique furniture and good artwork. Anything too personal they moved into their smallest bedroom and had a lock fitted.
They never had a problem in maybe 10 years. The companies would probably have found out if there had been problems with their employees as they were the referee.

I should say the house wasn't particularly close to any major employer. The closest I remember was travelling about 7 miles at a guess but 30mins drive as quite rural.

It depends if you're local and can be around to manage it or if you're too far away for that.

If you're local, I'd say be rigid with your checks. 3 months bank statements, employment contract, British passport/birth certificate OR home office documents giving them permission to be here (or whatever other legal documents they have). Do an online credit check.

No pets. Depending on the size of the flat, no children. Do a strict inventory. Put the deposit with one of the organisations (can't remember their names).

If you're not local, as the others have said, hand it over to an agent. They won't be great, but at least they'll get a plumber if the tap is dripping and will do things like arrange the annual gas safety check. Plus they'll do all the other admin bits listed above.

Grammaretto

Can you sell the furniture if you feel it's too good to leave in the house and with the money buy some cheap and cheerful stuff from IKEA?
As a tenant I wouldn't want to have vulnerable precious things to worry about
My flat is furnished but there is room for people to bring their own things too.

Our friends did that, and a new Ikea kitchen before the first rental through an agency. All was lovely and all stayed fine and looked after until the 'friendly acquaintance' rented it.

I'd reiterate what everyone else has said, have a reputable letting agent, I pay 11.5% it was 11 but they bumped it up half a per cent, but really they are there in the town and have a panel of tradespeople who they can get out asap to deal with emergencies. In addition to that, I would take out an insurance policy to cover for any default on rent and damage.

Whilst I haven't had any awful or malicious tenants, I'm not sure I'd leave good quality furniture in the property, most are let unfurnished anyway, but I imagine all of that could be negotiated.

Good luck! hope it goes well for you.

Can you sell the furniture if you feel it's too good to leave in the house and with the money buy some cheap and cheerful stuff from IKEA?
As a tenant I wouldn't want to have vulnerable precious things to worry about
My flat is furnished but there is room for people to bring their own things too.

A letting agent is a must.
They keep their eye on the property too.
Definitely no family, friends or aquaintances.

Excuse typos!

I'd advise going through an agent too.

Friends kept their old house as a rental property when they moved. The did let through an agent at first but when the tenant left someone they knew who'd split from his wife begged to be allowed to rent it. They didn't go through the agent, trusted him but he trashed the place. It was all very upsetting and it cost them a lot of money, not just redecorating but repairs, when they finally got him out.

More especially if you don't live in the same town (they did)
and can't visit, if there is a problem you need to be able to check r have an agent who will.

I agree with the advice to use a reputable letting agent. Ask around
They should also tell you all you need to know about tenants' rights, which have changed since Covid, fire regulations (also changed, at least in Scotland)

I let part of my house and used an agent because they do all the background checks.
He took almost all the first month's rent but after that I manage it myself.

As others have said, be wary of letting to a friend. Someone I know has done that and the couple split up. She left, he couldn't afford it on his own and stopped paying and stopped answering the phone .

Good luck but I also know someone who is about to sell her spare flat (she has moved in with her partner) because it's such a hassle especially when things go wrong in the flat. Today the cooker has stopped working.
It was very hard to deal with.

Thank you all, Great advice.

No we don't live near the property, so will have to use agent.

We would prefer not to have to empty property as we have good quality furniture, etc, and it would all have to go in storage, which would be expensive. Good quality, but no antiques or anything hugely valuable.

I will get in touch with a couple of local agencies. Thanks.

By the way don’t be put off by the potential pitfalls mentioned.
Renting out property is a very good source of income, and of course, certainly over the medium to long term, the property will increase in value.
A win/win situation!

Make sure your agent also does pre- and post-tenency inventories - when we tried to find one in London a few years ago it was impossible. My daughter currently rents in London and the inventory includes photots of everything in the flat which is very helpful for when she leaves, as it provides pictoria; as well as written evidence of any existing damage (e.g. broken chair leg).

My brother lets out a property in a University town. He has used the same letting agent for years. He and his family used to live quite near the property but they have since moved quite far away, which he finds less convenient if there are problems. Will you be living near your rental property?

Use a reputable agent and get good insurance. You will also need to change your buildings and contents insurance to a landlord’s policy or it will be void.

Use a reputable letting agent who has been in business for some time. It’s a good idea to get three round to get a feel for them and then research how many properties they have let recently in your area.
As the property is furnished I would say no pets. A lot of people these days seem to be allergic to animal dander which could cause problems with future lettings.

There is a big demand for private rentals at the moment so you should be in the situation where you can pick potential tenants carefully, with advice from the agent.

You also might want to consider taking out rent guarantee insurance which pays out if the tenants default on the rent.
Some policies also cover you for legal help if, in a worst case scenario, you get to the stage where you have to forcibly evict troublemakers. Not what any landlord wants to think about, but unfortunately there are rogue tenants around.

Use a letting agent.