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Buying-to-let?
Introduction
The Government has increased the legislation which affects the renting out of property, and it looks likely that further Regulations will follow.
The Tenancy Deposit Scheme applies to all tenancy agreements dated on or after 6th April 2007. From that date, all deposits paid on a tenancy agreement entered into on or after that date must be held under the Scheme. There are 3 schemes in existence. One scheme is custodial, where the deposit is no longer held by the Landlord but by the Scheme holder; the other two schemes are insurance based where the Landlord holds onto the deposit but pays an insurance premium to the Scheme holder.
It is thought that most private Landlords will opt for the custodial scheme. This is known as The Deposit Protection Service www.depositprotection.com or tel. 0870 707 1707 for further information.
All deposits must be dealt with within 14 days of receipt. There are penalties for failure to deal with the deposit correctly, and it then becomes more difficult for a Landlord to obtain vacant possession at the end of the term of the tenancy.
Houses in Multiple Occupation (HMOs). As a very rough guide, an HMO can be summarised as any rented house or flat with 3 or more (unrelated) tenants sharing facilities eg. kitchen, bathroom etc. As from 3rd July 2006 ALL Managers of HMOs have comply with the New Management Regulations. These Regulations require that the Manager gives details of his name, address and telephone number to all tenants, and sets out certain safety, maintenance and fire prevention measures to be adopted, matters relating to water supply and drainage and the supply and maintenance of gas and electricity and sufficient litter bins etc. Further information can be obtained from ourselves or in The Licensing and Management of Houses in Multiple Occupation (Additional Provisions) (England) Regulations 2007 or from the Private Sector Housing Department of your Local Authority.
In addition, some HMOs have to be licensed. It is now a criminal offence for a Manager not to hold a Licence for any HMO which is 3 or more storeys high and occupied by 5 or more people and in 2 or more households. Each HMO has to have its own Licence, which means that a Landlord owning 3 HMOs will have to hold 3 different Licenses. The Licence has to be obtained from the relevant Local Authority, who will need to be satisfied on a number of requirements relating to both the Manager and the property. Again further information can be obtained from us, or from the Private Sector Housing Department of your Local Authority.
