Have you been considering becoming a landlord but aren’t sure where to start? In this article, we will guide you through what’s involved in becoming a landlord, the responsibilities that come with it, and the key factors to consider before taking the plunge.
At Martin & Co, we understand that landlords come in many forms. Broadly, they can be grouped into four main categories:
First-Time Landlords: New investors who have recently acquired their first buy-to-let property.
Professional Portfolio Landlords: These individuals have a large portfolio of properties and rely on them as their primary income source.
Small Portfolio Landlords: These landlords have built up a buy-to-let portfolio to supplement their primary income or for investment purposes.
Accidental Landlords: These are individuals who typically inherit a property or opt to rent out their former primary residence to facilitate a move.
At Martin & Co, we cater to all types of landlords, whether you own a single property or manage a large portfolio. With a focus on providing the best letting services in the industry our experts are here to guide you through every step of the process.
Our main operations focus on Poole, Bournemouth, and surrounding areas, with popular locations for buy-to-let investors including Boscombe, Parkstone, Pokesdown, Charminster, Winton, Westbourne, West Cliff, and Lansdowne. These areas offer the ideal mix of housing stock and rental demand.
Who Can Become A Landlord?
In theory, anyone over the age of 18 with the legal right to buy and own property in the UK can become a landlord. However, there are a few hurdles to consider.
The biggest challenge will likely be financing the property. A standard residential mortgage won’t work for buy-to-let properties; you will need a buy-to-let mortgage, which typically carries higher interest rates. Additionally, lenders have specific criteria for who they will approve for a buy-to-let mortgage. For instance, first-time buyers looking to purchase a buy-to-let property or inexperienced landlords hoping to invest in a House in Multiple Occupation (HMO) may find the process more difficult.
The best place to start is by consulting a mortgage advisor. They can help you evaluate your financial options and determine whether buy-to-let is a feasible investment for you.
Why Become A Landlord?
Now that we’ve established who can become a landlord, the next question is why?
For many, the primary motivation is financial. Owning a rental property provides a regular income stream through tenant rent payments, and the potential for capital appreciation can make property investment very lucrative. However, with rising regulations, tax changes, and the risks posed by market fluctuations or interest rate hikes, it’s important to carefully evaluate whether becoming a landlord is truly the right financial decision for you.
Understand That Buy-To-Let Is A Business
One of the most common mistakes new landlords make is underestimating the amount of work and responsibility involved. Becoming a landlord isn’t a “hands-off” investment—it’s a business. You need to:
Understand regulations
Know your market
Keep accurate financial records
Handle tenants professionally
Treat the property as a business asset, not with sentimentality
Be prepared for unexpected expenses, which could impact your profit margin
Landlord Compliance Requirements
ENERGY PERFORMANCE CERTIFICATE (EPC) It’s a legal requirement to have a valid EPC for your property. This is to comply with the minimum level of energy efficiency required to let a domestic property under the Energy Efficiency Regulations 2018.
ELECTRICAL INSTALLATION CONDITION REPORT (EICR) To comply with The Electrical Safety Standards in the Private Rented Sector (England) Regulations 2020, electrical installation in residential properties must be inspected and tested at intervals of no more than five years by a qualified and competent person. A copy of the electrical safety report must be provided to the tenant and to the local authority if requested.
LEGIONNAIRES’ DISEASE In accordance with the Health and Safety Executive’s code of practice, a Legionnaires’ disease risk assessment must be carried out at the property.
FURNITURE AND FURNISHINGS All furniture supplied must meet the standards of the Furniture and Furnishings (Fire) (Safety) (Amendment) Regulations 2010 and be manufactured from fire resistant materials.
FIRE SAFETY Under the Regulatory Reform (Fire Safety) Order 2005, periodical fire risk assessments must be carried out in the common areas of HMOs, flats, maisonettes and sheltered accommodation.
GAS SAFETY CERTIFICATE To comply with The Gas Safety Regulations of 1998. An annual gas safety inspection of gas appliances, pipe work and flues must be carried out by a Gas Safe Registered Engineer who will issue a Gas Safety Certificate as proof of the inspection.
SMOKE AND CO2 ALARM In accordance with The Smoke and Carbon Monoxide Alarm (Amendment) Regulations 2022. At least one smoke alarm must be installed on every floor of a rental property. All rooms with a solid fuel source must also have a carbon monoxide alarm installed.
CONSENT TO LET A PROPERTY Where the property to let is subject to a mortgage, permission may be required from the mortgagees to let the property.
INSURANCE You must make certain that your property is adequately insured. Moreover, your policy will be void if your insurers are not aware that the property is being let.
LICENCE (HMO) Where a property falls under a licensable House of Multiple Occupation (HMO), evidence of the HMO licence is required to confirm that the property complies with all relevant regulations.
Further Responsibilities As A Landlord
As a landlord you are responsible for the majority of repairs and maintenance in the property you are looking to let. This includes electrical, wiring, plumbing, hot water and heating and repairs to the external structure and integrity of the building.
It’s also your responsibility to ensure that your rental property is ‘fit for human habitation’ for the duration of the tenancy. This covers issues such as damp, mould, vermin infestation etc. If the tenant believes you haven’t fulfilled your obligations in this regard, they can take you to court.
When letting a property in England you are required to check your tenant’s right to rent your property. You must also protect your tenant’s deposit in a government-approved security deposits scheme.
Finally as a landlord you will also want to ensure you keep detailed records and copies of all the relevant compliance documentation, listed above, as well as your tenancy agreement, inventory and income so you can complete your annual tax return.
Your Rights As A Landlord
As a landlord, you are entitled to expect your tenants to care for your property, pay rent on time, and adhere to the terms of the tenancy agreement. If they fail to meet these obligations, you have the right to initiate eviction proceedings.
Section 8 Notice: Can be used to evict tenants due to rent arrears or other breaches of the tenancy agreement.
Section 21 Notice: Enables you to regain possession of your property, typically at the end of a fixed term or during a periodic tenancy. Note that recent political changes may impact landlords’ rights to evict tenants, so it’s always advisable to seek legal advice when necessary.
It’s also important to understand that once you let a property, it becomes the tenant’s home, and you cannot enter without giving 24 hours’ written notice, unless there is a genuine emergency.
Should You Self Manage Or Use a Letting Agent?
Now you have a good overview of the responsibilities involved in being a landlord. You need to seriously consider whether or not you can commit to managing the property yourself. Many landlords feel they are better off instructing a letting agent to manage the process for them.
Managing property can be overwhelming, stressful and time-consuming which is why most landlords decide to put their trust in a letting agent to handle the process and take away the hassle. It’s important to understand exactly what your letting agent offers as part of their management service. Service levels and standards vary widely between agents. Click here for an article on six common pitfalls to look out for when instructing a letting agent.
To become a landlord you are going to need something to rent. This could take the form of a house, bungalow, apartment, commercial premises, multi-occupancy property etc. When purchasing the key is to think about the kind of tenant you want to attract. This will largely determine the kind of property you buy and the location you buy in.
Your desired property needs to be balanced with the predicted rental yield and how much profit you want to make. Afterall there is no point buying something that will not generate an income. To find the rental yield, divide the annual rental income by the property value, then times it by 100. Don’t forget to factor in the associated costs. When working out profit you should consider; mortgage payments, insurances, repairs/service charges, compliance costs and letting agent fees.
It’s worth consulting some local letting agents at this stage. They will be able to guide you on predicted rental incomes and the popularity of your chosen area.
You should always check that the property you intend to let is allowed to be let. If the property is freehold check for any restrictive covenants. If leasehold, it’s imperative to check the terms of the lease. You may need to obtain consent from the freeholder in order to let. Your lease may also contain clauses which restrict certain types of lets (such as short term or holiday letting). There may also be other clauses (such as pet restrictions) which may limit your potential tenant base. Click here to view our available properties to buyin Bournemouth, Poole and the surrounding areas.
Decide If You Will Let Your Property Furnished Or Unfurnished
There’s no right or wrong answer here, but again you should consider the type of tenant you’re trying to attract. Long term tenants may wish to have their own furnishings and creature comforts to make a property feel more homely. On the other hand short term tenants or those holiday letting will likely want to be catered for. Furnished properties often attract higher rents, but you need to factor in the added upfront cost to fit out the property. You will also have the ongoing commitment of upkeeping and maintaining the included items.
Prepare Your Property
When preparing your property for market you need to ensure that it’s as appealing as possible. You should spend some time going through the property to resolve any maintenance issues, decorate with light and neutral colours, and make sure the property is clean and ready to view.
Finding Your Tenants
There are various ways to go about finding tenants. If you’re letting privately you’ll likely want to advertise on forums such as Gumtree and Facebook. If you’re looking for a more professional approach and access to a greater number of prospective tenants, then it would be advisable to instruct a letting agent. Letting agents usually have access to large databases of prospective tenants. They also have the ability to professionally list your property on dedicated portals like Rightmove and OnTheMarket which you cannot list on privately. If you want the better marketing without the management lots of letting agents will offer a tenant find only service.
Referencing Your Tenants
Once you have some interested applicants you will always want to obtain references. This is to establish your tenant’s identity, ability to pay the rent, creditworthiness and character. A standard referencing process will include:
Check Their ID And Right To Rent In The UK – you should request to see a prospective tenants driving licence or passport as well as a recent utility bill to verify their identity. At this stage you should also carryout a right to rent check which is a legal requirement.
Checking Income – We recommend asking your prospective tenant for at least 6 months payslips and bank statements to verify their income. We advise that their yearly earnings should equate to two and a half times the annual rental amount or more. If the tenant requires a guarantor then we recommend the guarantors yearly earnings are able to cover three times the annual rental amount. You should also request an Employer’s reference to verify their claimed income and confirm that the prospective tenant is in permanent employment.
Credit Check – Before you let your property to a prospective tenant you want to know that they have a good track record of paying their bills and meeting their obligations. There are three primary credit reference agencies you can use in the UK; Experian, TransUnion and Equifax.
Landlord’s Reference – If the prospective tenant has rented before hearing the feedback of their previous landlord will be invaluable in helping you decide if they are a suitable prospect. If the previous landlord is unwilling to provide a landlord reference this is a big red flag! Don’t forget to follow up and check the authenticity of both the employers and landlord’s reference.
Before Your Tenant Moves In
Tenancy Agreement – Before moving into the property you need to make sure your tenant has read, understood and signed their tenancy agreement. The most common tenancy agreement used for long term residential lets is an Assured Shorthold Tenancy Agreement. There are different tenancy agreements for different kind of lets such as Holiday letting, commercial lets & licence to occupy.
Inventory – You should carefully document the state of the property, it’s fixtures, fittings and contents before a tenant moves in. Be sure to take photos, videos and detailed notes to support the documented condition of the property. The inventory should be agreed upon and signed by both you as the landlord and your tenant. Well documented inventories are crucial should any damage occur in the property. They typically help avoid disputes about damages arising. However, if one should occur, they are invaluable evidence to prove the state of a property at the beginning of the tenancy.
Insurance – If you are financing your property with a buy-to-let mortgage the lender will require you to take out suitable buildings insurance. Note your will need a landlord specific insurance policy rather than a normal homeowner’s policy. Buildings and contents insurance are not legal requirements but still strongly advised for obvious reasons. Over and above insuring the property there are other products available. Think specialised landlord insurance and rent protection insurance which can provide you with peace of mind.
Once The Tenant Has Moved In
There is still work for you to do once your tenant has checked-in. You will need to take care of collecting the rent, carry out inspections, renewing the tenancy agreement, taking care of any maintenance enquiries, organising and instructing contractors as well as keeping a close eye on all the compliance elements with certificates that expire at different times and regular changes in legislation. Failure to keep up with the latest changes in the law and remaining compliant can lead to hefty fines and in some cases even imprisonment.
Letting Agents In Bournemouth
Conclusion
For those of you who have made it this far we hope this blog has provided you with a helpful insight into the world of being a landlord.
Are you looking to let a property in Bournemouth, Poole or the surrounding areas? Talk to our award-winning team to discuss the process further. Our agents are friendly, professional and keen to offer you their expertise. Please feel free to contact us at any stage of the process.
The team at Martin & Co wish you every success in pursuing your dream to become a landlord. We hope you find the right rental property, tenants and letting agent to make it an enjoyable experience!
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James has lived in the Poole & Bournemouth area for over 25 years and has an extensive knowledge of the conurbation. He started his career in the property industry in 2015 following his graduation from the University of Kent, Canterbury and has worked in a variety of different roles in this time. Formerly a Sales Manager, he brings an in-depth understanding of the industry to his current role as Marketing Manager at Martin & Co.
