CKD Galbraith’s Top Tips For Landlords
Currently experiencing an all-time low in rent arrears across its managed portfolios, with less than 1.4% of tenants having arrears of over one month, CKD Galbraith is bucking the national trend which saw the industry experiencing a 6.2% increase in rent arrears, according to the latest Scotland Buy-to Let Index (August 2015).
Competition for suitable properties is high amongst tenants and the key to low levels of rent arrears is careful tenant selection at the outset. Choosing a reputable agent that will help with tenant selection and missed payments is vital as well as keeping abreast of the ever changing landlord legislation.
Shirley Kenyon, head of lettings at CKD Galbraith, offers landlords a checklist to bear in mind when considering the rental industry:
- Are you up-to-date with recent legislation including:
- Scottish Government, Private Housing (Tenancies) Bill – proposal in the bill include the ability for councils to introduce rent controls in areas where there are 'excessive' increases; limit on rent increases to one per year; changes to notice periods and eviction terms for tenants; more progressive repossession grounds for rent arrears cases, as well as new repossession for landlords where they want to sell their property or the tenant has abandoned the property
- Mortgage Interest Tax Relief – to be implemented in a phased approach beginning April 2017 – the amount landlords can claim as relief will be set at the basic rate of tax (currently 20%)
- Carbon monoxide alarms will have to be installed in all rented houses when the Scottish Government guidance comes into force on 1st December 15
- Legionnaires Disease – landlords must now take suitable precautions to prevent or control the risk of exposure to legionella
- Tenancy Deposit Scheme – all landlords are required by law to safeguard a tenant’s deposit in this scheme until it is due to be repaid. This scheme ensures that both landlord’s and tenant’s money is protected.
- Landlords have a legal duty to provide a Tenant Information Pack which provides important information to tenants in the private rented sector including details on the property condition, tenancy agreements, and the rights and responsibilities of landlords and tenants.
- Comprehensive inventory – landlords must allow for a level of ‘fair wear and tear’ to their property during the rental period. A comprehensive inventory is conducted at the beginning of the lease so that both parties are aware of the condition of a property and that any damage can be accurately assessed.
- Property inspections should be carried out regularly by a dedicated lettings agent or landlord and documented accordingly. These can provide useful evidence in disputes over fair wear and tear as outlined above.
Being abreast of all of the above helps landlords foster good tenant relationship which encourages low rent arrears as well as generating longer lease agreements which is currently being experienced by CKD Galbraith. For example its Ayr office saw 60% of all new tenancies granted in the first six months of 2015 being 12 month tenancies compared with just 17% in the same period of 2014.
Shirley said: "Securing longer tenancies on behalf of landlords was a combination of careful tenant selection by our agents in establishing the future performance of a prospective tenant through credit checks and references, providing them with a prompt management service in well maintained houses, and issuing where appropriate, 12 month agreements rather than a six month one providing both tenant and landlord security."
CKD Galbraith operates dedicated lettings divisions across the country managing the lets of over 1000 homes and has a wealth of experience in assisting both landlords and prospective tenants with a range of budgets.
CKD Galbraith is a member of the Royal Institute of Chartered Surveyors (RICS), the Association of Residential Lettings Agents (ARLA) and the National Approved Letting Scheme (NALS). In addition, CKD Galbraith holds a SAFEagent accreditation which guarantees that tenants' and landlords' money is protected by a client money protection scheme.