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Posted this query on the Property Hub, but no responses to date so apologies for any duplication if you're members of both sites.
I am currently pondering whether to self-manage an existing BTL 2-bed flat near Canary Wharf, London on a house-share, individual room basis once the current tenancy period is up with a local agent at the end of Q1 2019.
I previously lived in the flat so expenses wise I'm pretty sure they're in the right area, and checking on Spareroom, Gumtree and Rightmove, the potential rental for each room should more than cover the costs (est. £400-500 net more per month compared to current rental income on a single AST).
I'm flipping through Rob D's 'How to be a Landlord' book again as I read it when it first came out, and just wanted to check that I haven't missed anything.
- Lease: checked to ensure it's allowed
- Mortgage: checked to ensure it's allowed
- Council: pay council tax + there's a new selective license coming into force in April 2019
- Utilities: water, electricity and heating (Heatlink system in building - no gas)
- Broadband: currently has fibre optic line in with Hyperoptic, so can take out a plan without a BT phoneline
- Contents Insurance: it'll be a furnished flat, but nothing of high value so look to take out min. cover c£10k
- Voids: assuming there'll be some turnover
- Maintenance: we'll give it a quick spruce and the Mrs will decorate the place prior to letting it back out. During the previous 2-years it was let, we only had two issues - new toilet seat, and new toilet flush
- Fire safety: already has fire doors and relevant smoke/CO2 alarms
- Electrical safety: will arrange for a PAT to be done. EPC still within the 10-year timeframe when purchased.
- Cleaner: optional
- House Manual: will create one
- Advertising/seeking Tenants: OpenRent and Spareroom
Is there anything that I've overlooked or totally forgot? Appreciate any help. Thanks!
Blog at http://abcdad.co.uk/ and Insta at http://www.instagram.com/abc.dad/
Looks like you have it all covered. Personally i never get contents insurance for my own furniture as for rental flats the most likely reason to replace is either tenant damage or wear and tear, neither of which are covrred by the insurance.
Are you doing your own contract? Make sure you register the Deposit correctly, and attach the gas cert, EPC, and "how to rent" booklet. The "set-up" these days is tricky with all the boxes you need go tick but its important.
Thanks for responding, Daniel.
I'm currently looking at using OpenRent to help set up the tenancy (including deposit protection and prescribed info), so that should assist with all the legal stuff. They've confirmed they have an option for shared flat listings.
we've recently done this (also east London) and its all going ok.
cant see how bills will be as much as:
'(est. £400-500 net more per month compared to current rental income on a single AST).'
rather annoyingly my tenants have a penchant for opening windows during freezing weather, but fortunately have incorporated a fair usage policy in our ast. confirm meter readings monthly and tell them if over threshold.
we never insure contents either. we have a cleaner go in every fortnight for common parts. if its got a kitchen/diner may be use lounge as bedroom too.
Thanks Joe, that's good to hear. Provides a bit more confidence. Are you in the Tower Hamlets borough?
Sorry if I didn't type / explain the £400-500 per month clearly, but that's the estimated net cashflow increase if I switch it from the current AST to the multi-room let, not the actual expenses.
Good point about the fair usage. Did you create the AST yourself or use one from the RLA? I was looking at using OpenRent's services but haven't actually seen their documents yet as we're still some way off the new self-management it at the moment.
Looks like we can forgo the contents insurance too. We were quoted c.£60 per annum for £10k cover, but to be fair, most of the contents were things we left at the flat when we moved out so it's nothing too sentimental. And as Daniel mentioned wear and tear isn't covered, so that saves a bit more each month.
youre welcome. our rooms are in Newham. we use the rla agreement but with an extensive addendum.
You will need a fire risk assessment and a legionella risk assessment. You can carry these out yourself if you think you are competent or pay a professional to do them
As well as PATing you should get a full electrical safety inspection as PAT only test appliances.
Thanks qweasdzxc for your help. It already had a fire risk assessment a few months after the Grenfell disaster, hence why we already have all the fire doors and alarms in each room. But I'll double check and sort out the legionella risk assessment.
I'll also add on the electrical safety check too, but I was under the impression this wasn't compulsory yet in England? It's a fairly new build (2012/13) so don't expect there to be too many issues.
Was the FRA carried out for the communal areas or for your flat? You need one for your flat and the freeholder/responsible person needs one for the communal areas.
We had one done on our flat and I believe the management company of the block did one on the communal areas post-Grenfell and also checked the cladding. But I'll double check.
I'm due to inspect the flat next week and will hopefully get it back in a couple of months following S21 being served so will also double check the fire doors / alarms are still there.
Cheers for the help!
Are you looking to let this on separate tenancy agreements or everyone on one AST, moving in and out together? How many people are you actually looking to rent the flat out to?
Your lender will need to know and make sure you get it in writing!