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5 Top tips for new landlords

Being a new landlord can be a scary thing Рthere are over 160 different pieces of compliance anlegislation to keep up to date with Рno wonder so many end up outsourcing! 

 

But, as landlords ourselves, we understand the importance of self-management and giving it a go, which is why we’ve put together a list of the top 10 tips for new landlords – especially after the year we’ve had, it’s difficult to keep track of notice periods, maintenance and do’s and don’ts as landlords.

1. Debt respite scheme

The first tip we have in at number 1 is a new scheme which came into play in May this year – the government’s new debt respite scheme. The scheme (which covers a range of different debts including rent arrears) enables people who are financially struggling, to apply for something called “breathing space” or a moratorium ‚Äď namely a period when they do not have to make repayments. The government expect around 700,000 homes across the UK to be taking advantage of this scheme!

There are two types of breathing space that can be applied for: a standard breathing space, known as a Breathing Space Moratorium, and a mental health crisis breathing space, known as a Mental Health Crisis Moratorium.

A Breathing Space Moratorium gives people legal protection from creditors, such as landlords, taking action for up to 60 days, with most interest and penalty charges frozen, and enforcement action halted.

A Mental Health Crisis Moratorium is available to people receiving mental health crisis treatment. It offers the same protections as above but lasts for the length of the treatment plus 30 days.

 

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2. Evictions 

Evictions in England can resume from 1 June 2021 but landlords will have to continue giving their tenants extended notice periods. The only evictions that can happen before this date are ones due to anti-social behaviour, illegal occupation, fraud or rent arrears of more than six months, as well as cases of domestic abuse in the social sector. Even once the ban is lifted, bailiffs cannot carry out evictions if anyone in the property has Covid-19 symptoms or is self-isolating. The government said in lifting the ban it recognised that 45% of private landlords owned only one property and were highly vulnerable to rent arrears.

Landlords can start eviction proceedings by issuing either a section 21 or section 8 notice once the ban is lifted. As a landlord, you do not need to give a reason to evict tenants under a section 21 notice, but you must provide a warning period. You can only issue a section 8 notice if there are legal grounds, for example if tenants are in rent arrears. A free mediation service has also been set up to help landlords and tenants resolve disputes without having to go to court, in a bid to help more people stay in their homes.

The ban on evictions will remain in place in Wales until 30 June.

3. Notice periods

While evictions can resume, landlords will have to continue to give tenants longer notice periods until at least October.

The extended notice period of six months, up from the usual two months, which was put in place as part of emergency measures introduced during the pandemic, will expire on 31 May.

But it is being replaced with a new four-month notice period, which will remain in place until 1 October, after which notice periods should return to normal, subject to public health advice and progress with the roadmap out of lockdown.

It is worth noting that there are some exceptions under which shorter notice periods can be given.

For example, from August 1, if your tenant has accumulated rent arrears of more than four months, you will only need to give them four weeks’ notice.

If a tenant has made a false statement the notice period is reduced to two to four weeks, and in the case of anti-social behaviour, eviction can be immediate or up to four weeks’ notice given.

Landlords in Scotland have to give notice of 28 days, three months or six months depending on the reason for the eviction, while in Northern Ireland they must give 12 weeks’ notice up from a normal notice period of 28 days.

4. New safety requirements

In a bid to improve tenant safety, the government has introduced new requirements for landlords to demonstrate that any electrical installations, such as wiring and electrical sockets, have been tested by a qualified electrician. 

Landlords previously had to have an Electrical Installation Condition Report for every property they owned for new tenancies, and since 1 April 2021, they also need to have one for existing tenancies. 

In addition, landlords need to ensure inspections are carried out at least every five years and the tenants are given a copy of the report within 28 days of it being issued.

Landlords in Scotland have been given an extended timeline in which to install heat alarms in kitchens, smoke alarms in living rooms, halls and landings, which must all be interlinked, and carbon monoxide alarms near any carbon-fuelled boilers, fires or heaters.

The new measures, which are in response to the Grenfell Tower fire in 2017, had been due to come into force on 1 February 2021.

However, the Scottish Parliament has delayed the requirement until February 2022.

5. Stamp duty holiday extension

Investors thinking of expanding their property portfolios have until 1 October 2021 to take advantage of the stamp duty holiday after the deadline for the tax break was extended.

While landlords buying properties are still liable for the 3% stamp duty surcharge on additional homes, they are exempt from paying basic stamp duty on the first £500,000 of property until 30 June. The holiday will then continue on the first £250,000 until 30 September.

When the stamp duty holiday ends on 1 October, normal stamp duty obligations will resume, with this sum paid in addition to the stamp duty surcharge.