What Do Tenants Need to Check Before Renting?
Committing your signature to the dotted line and proceeding with a tenancy agreement is by no means a small step. Of course finding your next home and taking those first steps after moving in is a wonderfully fulfilling experience, but in all the excitement it’s easy to dismiss the fundamentals and get lost in the experience.
Do You Need Contents Insurance?
When moving into a rental property there is often confusion as to whether the occupants will need to take out their own contents insurance police. As can be expected the landlord will already have such a scheme in place to ensure that the furnishings throughout the accommodation are covered, but it is essential to note that this will not provide adequate protection for any belongings that the residents introduce to the rental.
Although all parties that move into a rental property will go through the referencing process, with their previous landlords offering the owner of their new accommodation comments on the residents historical conduct, I would be unwise for the landlord to leave the embellishments of the interior of their property unprotected. With this being said, whilst taking out a content s insurance policy is essential for landlords, it is somewhat neglected or left underappreciated by the majority of tenants.
It goes without saying that the specifics of what is included in each policy taken out will vary between insurance providers, but in most cases the insurance will grant protection to most household items in the event of a fire, theft or flooding throughout the property. Alongside these policies could also cover the costs of any consumables that have been spoiled through their fridge or freezer breaking, any goods that have been stolen from the accommodation and in some cases liability insurance in the instance that a guest in the rental is injured. However, it is essential for renters to note that they may not be able to claim for all he items that they wish to as there are monetary limits placed on the amount insurance providers will provide when paying out; if in doubt always evaluate the terms of the appropriate policy.
Whilst it is easy to dismiss the need for such an insurance policy because of the seemingly low likelihood of these events taking place, but the value of contents insurance policies are made abundantly obvious in hindsight. Despite the financial safety such policies can offer to tenants, albeit at a fee, at the time of writing it has been revealed that almost half of all tenants in the UK do not hold valid contents insurance.
There are certain circumstances under which the insurance policies will not offer this financial protection to the policy holder. If at the end of the fixed term detailed in the tenancy agreement the tenant intends to make a claim for any damage that has been deemed fair wear and tear, no pay out from the policy providers will be forthcoming. Additionally, in the instance that the rental property is left unoccupied for an extended period of time, typically around 30 days, the insurance policy will be invalidated. Similarly, any accidental damage, or specific belongings or items of a high value may need to be granted additional protection as they may not be covered under a standards contents insurance policy.
Do You Need to Pay Any Rent in Advance?
When moving into a rental property tenants are often expected to not only make payments to the landlord in regards to both the holding and tenancy deposit, but they may occasionally be asked to pay rent in advance. Whilst this is not a completely widespread practice this is commonly requested if the landlord holds some reservations about renting their property to the tenant and is seeking some additional security surrounding the occupant’s obligation to meet their rental obligation.
With this in mind, if the tenant is in receipt of financial support such as universal credit, or other forms of DSS, yet the landlord is still willing to let out their property, it is likely that a request will be made to have some amount of rent paid before the established move in date. Although there is technically no legal limit to the amount of rent a landlord can request a tenant pay in advance in most cases this is no more than one or two months’ worth of rent.
Even though it would be easy to see how such an arrangement could exclusively serve to benefit the owner of the rental property, it is important to keep in mind that avoiding the accumulation of rent arrears is in the best interest of all parties. In some cases where the landlord wishes the aspiring tenants to pay rent in advance, the tenants may be able to use this to negotiate with the landlord, agreeing to pay an increased amount of rent upfront on the condition that the amount they are obligated to pay each term is reduced, granting them a lower amount to pay in the long run, something that will prove invaluable when trying to save for their next tenancy deposit or a property that demands a higher rental charge.
It is difficult to understand the importance of an accurate property inventory for both the benefit of the landlord and their tenants. Curated on the outset of a tenancy, the property inventory is a comprehensive report that details the condition of each room within the accommodation, alongside the furnishings found throughout the property and their condition. This is essential as it clearly establishes the bar for the condition in which the owner of the rental property expects the accommodation to be returned in at the end of the fixed term. As can be expected the landlord will perform numerous inspections throughout the course of the rental period, but having a detailed report such as the property inventory to hand leaves no room for ambiguity surround when damage may have been caused, and if any found issues have grown worse over time.
This clarity is essential as once the tenancy period has come to a close the landlord will look to recoup any costs they incur when needing to repair, maintain or replace any aspects of the rental property, with the document providing irrefutable evidence as to the state of the property once the current tenants stepped through the door. When evaluating if any deductions need to be made from the occupants tenancy deposit another property inventory report will be created to allow for a seamless comparison between the beginning and close of the rental period, with the documentation being supported by images taken by both the landlord and tenant, with witnesses being needed by both parties to verify the collected information is accurate and in no way misleading.
To this end the property inventory becomes invaluable should any disputes arise over potential deductions being made from the sum being returned to the tenant from their deposit, whilst clearly defining anything that would constitute fair wear and tear within the rental.
Ensure the Tenancy Deposit Has Been Protected
In the overwhelming majority of case when a tenant moves into a rental property they will be required to pay their landlord a tenancy deposit. This amount will be held by the landlord for the duration of the tenancies fixed term, with the full amount potentially being returned to the tenant at its expiry. Unlike the holding deposit that is often returned to the occupants when they move into the rental through the form of a reduction off their first rental payment, the tenancy deposit, sometimes called the security deposit, may not be returned to the tenants in full.
This is because the landlords is able to make deductions from the amount being returned to the occupants at the close of the tenancy to offset any costs they may face as a result of any damage to the property caused by its inhabitants, or any rental payments they may have failed to pay.
To the delight of renters, the tenant fees act 2019 introduced a limit on the amount landlords are able to request from aspiring tenants before they move into the rental property. Providing that the annual rental charge for the accommodation does not exceed £50,000 the landlord is able to request a maximum of five weeks rent from their tenants for the security deposit; however, if the amount the occupants pay in rent each year is over this amount the landlord is able to ask for the equivalent costs of up to six weeks rent.
When this amount is provided to the landlord they have 30 days in which to enter the taken amounts into a government approved tenancy deposit scheme. The owner of the rental property is further obligated to provide the tenants with the details of the scheme under which the taken amount has been protected, alongside the circumstance under which a deduction from the sums being returned could be made.
If the landlord fails to safeguard the tenant’s security deposit through an approved deposit protection scheme they could be forced to pay the affected occupants compensation. This repayment could prove extremely detrimental to the landlord as the amounts awarded to the residents in compensation could amount to as much as three times the sums taken for the tenancy deposit. However, even when taking legal action against the landlord for neglecting to protect their tenant’s tenancy deposit, they are still entitled to account for any deductions that need to be made for missing rental payments or damage to their property if caused by the tenants.
It is worth noting that this is only the case for tenants that hold an assured shorthold tenancy, and residents that are considered to be a lodger or a student living in halls will not be afforded this right to have their deposit protected, however this is not to say the amount requested for the deposit can be simply taken by the owner of the accommodation or the letting agent.
Obtain the Appropriate Documentation
When moving into a rental property there are a series of documents that the landlord must serve their tenants within 30 days. Not only will the tenants need these to make a more informed decision on whether they should proceed with the tenancy agreement for the given rental opportunity, but if the landlord neglects to provide this information they will also be prevented from pursuing eviction through the serving of a section 21 notice.
Energy Performance Certificate
Landlords are obligated to serve each occupant with the most recent copy of the energy performance certificate for the property. This documentation will rank the energy efficiency of the property, whilst ensuring that it meet the Minimum Energy Efficiency Standard for renting. Not only will the correspondence provide the tenants with a comprehensive breakdown of where the property could be more energy efficient, but also offer an estimation as to its running costs and utility bills.
Gas and Electrical Safety Certificate
When moving into a rental property it is the landlord’s obligation to provide their tenants with the most recent gas and electrical safety certificates for the property. Whilst they will only be required to obtain an electrical installation condition report for their rental opportunity every five years, the gas appliances, flues, boiler and heating system must be evaluated by a qualified and certified gas safe engineer each year.
Government’s How to Rent Guide
In an effort to allow aspiring renters to have a more educated and informed rental journey, landlords are further required to issue their tenants with the latest copy of the government’s “How to Rent Guide”. This documentation can be an invaluable resource to those new to renting, comprehensively detailing their rights and responsibilities as a tenant, what they can expect from their landlords, alongside where they can turn for assistance if they believe they may be unable to pay their rent, or are involved in a dispute with the owner of the rental property.
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