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What is an Accidental Landlord?
What is an accidental landlord and what can you do about your situation if you happen to become one in the future? Perhaps you have already become an accidental landlord and you are looking for suggestions on how to make your life easier. If so, you’ll find all the information you need in this brief guide.
‘Accidental Landlord’ Definition
Let’s start with a simple definition: an accidental landlord is basically anyone who finds themselves in the position of having to rent out a property because they are unable to sell it at a price that is acceptable to them. Given the turbulence in financial markets in recent years, there are now probably more accidental landlords in the UK than at any other point in recent history.
What to do if You Become or Think You Need to Become an Accidental Landlord
If you find yourself in the position of having to rent out a property instead of selling it, we recommend following the suggestions below:
- Inform Your Mortgage Provider – If you are still paying off a mortgage on the property in question, you need to let your mortgage provider know of your plans to let out your home. Some providers will allow you to let a property for up to 12 months without making any changes to the terms of your loan. However, after this period, you will almost certainly have to obtain a buy-to-let mortgage to replace your existing finance agreement.
- Arrange a New Insurance Policy – A standard home insurance policy will not be suitable for a rental property in the UK. With this in mind, we recommend that you get in touch with your insurer to request a quotation for a new policy if you decide to let out your home.
- Keep Records of All Rental Payments for Tax Purposes – Rental payments are considered as taxable income in the United Kingdom so you will need to keep a record of all received payments. When you complete your tax return at the end of the fiscal year, you must mention these payments and provide any documentary evidence that may be required.
- Vet Tenants – Before you allow anyone to become a tenant in a property that you own, you will need to confirm that the person or people in question have a legal right to reside in the UK and to rent property here.
- Obtain a Licence if Required – In many areas of the UK, a licence is required for all properties that are let out. A house of multiple occupancy (such as a student house) will almost always need a licence in place before it can legally be rented to multiple occupants in the United Kingdom. Our expert Investment team can assist with any applications if required.
If you are looking for a helpful letting agent in Leeds who can take care of all the above-mentioned details on your behalf, don’t hesitate to contact us. We offer a full range of property management services to both accidental and deliberate landlords.
