Landlords

LANDLORDS GUIDE TO MANAGEMENT/LETTING SERVICES

(RESIDENTIAL)

For individuals or companies with property or properties to let, Ideal can offer a highly experienced and professional property letting and management service.  The following guide details the services undertaken on behalf of owners/landlords of residential properties subject to a Management Agreement.  This guide forms an integral part of that Agreement.

 

BEFORE LETTING You must ensure that

1.      If the property is to be let subject to a mortgage:

Permission is obtained from the mortgagee to let the property.  Note this must be obtained at the earliest convenient time before a tenant is found.  It should be noted that certain Building Societies/Banks charge an extra percentage on top of your base rate when your property is let.

 

2.      Properties in joint ownership:

Authority to let the property must be obtained in writing from any joint owner who should also be named in the tenancy agreement.

3.  If the property is leasehold:

A.    Confirmed letting is permitted by the terms of the Head Lease.

B.     Any tenancy is for a period expiring prior to the termination of your lease.

C.     Written permission is obtained from the Leaseholder where necessary.

 

INCOME TAX

Income from property is treated as unearned income and is therefore subject to the appropriate tax rate.  You will need to appoint an accountant in order to determine you tax liability.  If you are a civilian working outside the UK then the tax authorities will assess Ideal for tax due (under the Income Tax Management Act 1970).  In these cases we reserve the right to retain a portion of the rental to meet this tax assessment.  The deduction may be avoided if we have written confirmation from your Bank or accountant that they are empowered to deal with your tax affairs and that they will accept liability for and make payment for any authorised tax demand to the Inland Revenue on your behalf.  NOTE: There are allowances, which can be set against rental income in respect of tax.  These particulars being:

A.    Rental as depreciation.

B.     All Agents fees and charges

C.     All maintenance and servicing expenditure carried out whilst the property is let.

D.    House insurance

This is not meant to be a comprehensive list, your accountant will advise you accordingly. 

 

OUTGOINGS

 1.      By yourself

A.    You should ensure that you maintain paying insurance premiums with regard to the building.  Ideal does not accept responsibility for the adequacy or otherwise of any insurance cover.

B.     Any service/maintenance charges should be paid.  Ideal cannot verify service/maintenance charges, demands or estimates.

C.     Mortgage payments should be continued.

D   An Energy Performance Certificate (EPC) must be supplied prior to the letting commencing. This must be carried out by a qualified assessor and is a legal requirement. Ideal can arrange for this to be carried out on your behalf if required (cost of £75.00 Inclusive of VAT) An EPC rating of E or above is required

E.     Annual inspections of all gas appliances by a Corgi registered plumber are a legal requirement. Ideal can arrange for these to be carried out on your behalf if required. (Cost £65.00 Inclusive of VAT)

F. Provide and fit two ten-year tamper proof battery smoke detectors to the ground floor (in a suitable location) and first floor landing (if applicable). Provide and fit a carbon monoxide detector. (it may be possible for the landlord to get these fitted free of charge through the local fire service safety advice team).

G. All outstanding bills relating to the property must be paid in full before each tenancy agreement can be arranged.

                                                      LETTING & MANAGEMENT SERVICES

GENERAL TERMS OF ENGAGEMENT

RENT  We will agree with you the rent to be quoted to potential tenants.  In addition, the tenants would normally be responsible for payment of any Local Authority charges such as water rates, electricity, gas, telephone or any other statutory charges that may from time to time be levied against the occupier of the property.

DEPOSIT  The deposit paid by the tenant at the commencement of the lease may vary depending upon the circumstances of the letting but will be subject to the minimum charge of one months rental, this deposit is to be held by “ The Deposit Protection Service DPS Scheme” against damage or dilapidations that may be caused by the tenant.  No interest will be paid by The Deposit protection Service on the amount of deposit/bond held.

DILAPIDATIONS At the time the tenant leaves the property a schedule of dilapidations if necessary, will be prepared and costed.  It must be remembered that the property is subject to a fair wear and tear clause and will be subject to the stresses and strains of everyday living.  A property cannot be expected to be in the same condition at the end of a letting as it was at the commencement.  It must be expected that the interior decorations may need attention, even after a short period of occupation by tenants.  The full replacement cost of many items will have undergone various lengths of usages.  It is the landlords responsibility to ensure that all items left in a tenancy are maintained in working order, thus even repairs and replacement to old equipment must be paid for by the landlord.  Where possible, we strongly recommend service and maintenance agreements such as for central heating systems.  The client must ensure that we have full details of any such agreements in order that they may be kept in force and utilized if need be.

INVENTORY  We undertake to prepare an inventory of the contents and a brief schedule of your home at the start of the letting and to check the inventory and the schedule of condition at each change of tenant.  On vacating, the inventory is checked.  Where necessary revised inventories are prepared for subsequent tenants.

TENANCY AGREEMENT  The property will be let for a six month period on

an Assured Shorthold Tenancy agreement. The term is to include any periodic

tenancy following the fixed term.

INSURANCE  You must inform your property insurers of your intention to let the property as failure to do so may result in rejection of any subsequent  claim.  You should ensure that all premiums continue to be paid when due and that the insurance cover does not lapse.

PLEASE PROVIDE DETAILS TO IDEAL ESTATE AGENTS & PROPERTY MANAGEMENT LTD OF ALL INSURANCE POLICIES RELATING TO THE PROPERTY.

TENANTS  We will use our own professional discretion as to the choice of tenant although prior to the commencement of the tenancy full details regarding references etc, will be submitted to yourself. These are for a credit checks through a company called rent4sure, obtaining employers references and previous landlord references.

SERVICES  Upon vacating and re-entering a property, Ideal will notify all relevant suppliers in order that there is no liability for any charges that the previous tenants may have incurred.  Except in emergency and wherever practical, estimates will be obtained and submitted for your approval in respect of works of re-decoration, renewal and repair likely to cost more than the agreed amount.

 UTILITY NOTIFICATIONS

The Landlord hereby confirms that they have authorised the Letting Agent to take the following actions on behalf of the Landlord in connection with the supply of gas and/or electricity to each Property: (i) to enter into contracts with an energy supplier selected by the Letting Agent in connection with the supply of gas and/or electricity to each Property while that Property is vacant and to terminate any existing contracts with any other energy suppliers in respect of that Property ; (ii) to engage with relevant energy suppliers in connection with the management and administration of any energy supply contract(s) in connection with each Property; and (iii) to provide the Landlord's information (including any personal data relating to the Landlord and/or any of its officers, employees or agents) to and for use by any relevant energy supplier (and its agents, contractors and partners) for the purposes of processing any application that is made for the supply of gas and/or electricity to each Property and managing and administering any gas and/or electricity supply contract(s) in connection with each Property.

INSPECTIONS  We will carry out an inspection of the property at the commencement and termination of each tenancy.  Inspections during the course of the tenancy will be carried out if a serious defect requiring our attention has been reported to us.  It should be appreciated that our inspection and assessment of defects which are brought to our notice will be of a cursory nature and will embrace only apparent obvious defects.  In no way should these inspections be construed as being a structural or other type survey.  Any further inspections, structural or additional services which may be required will be by special arrangement and subject to an additional fee.  Ideal reserve the rights to appoint their own builder/repairer unless you inform us of any particular contractor you prefer to use.

RENT ARREARS/LEGAL ACTION  It can sometimes occur that tenants for a variety of reasons find themselves in difficulties and this can result in problems of rent arrears.  If legal action is required in order to obtain payment of rent arrears/and/or re-possession of your property then this would involve the services of a solicitor.  In any event you will be responsible direct for your costs in connection with any legal action taken against the tenant.  We cannot take legal action for you as the tenancy contract is between the tenant and you, not ourselves.

LEASE TERMS  Properties are normally let for a minimum fixed period of at least six months in order to comply with current legislation.  Once the initial term is complete, the landlord may obtain possession with a minimum of 2 months notice.

TERMINATION  Ideal appointment is subject to three months notice to terminate on either side.  From accepting instructions and during the full term of management, sufficient funds must be available to meet any expenditure prior to the next rent collection.  We cannot service any outgoings exceeding whatever is held by us in your account.

COMMUNICATION  Ideal will communicate with yourself via normal quarterly/annual statements. When a property becomes vacant you will be notified accordingly.  We do not, however, undertake to notify you independently as and when repairs are undertaken or any problems which may occur with regards to the tenancy unless you so require.

WHAT SHOULD BE LEFT  The condition of the property is a great point to take into consideration when we advise on a possible rent for the property.  Although every letting falls into certain guidelines, obviously if it is modern and pleasantly decorated then the rent assessment will be higher and a tenant should be found easier.  However, remember that tenants do not always look after the property as you would yourself.  Generally unfurnished accommodation should have carpets and curtains to every room, cooking facilities.

GENERAL

A.    Remember your property will be subjected to the stresses and strains of everyday living.  

B.     We will approve, without prior reference to you, maintenance and repair expenditure up to the amount previously agreed with you.  Any excess of this amount will be referred to you prior to expenditure unless expenditure results from an emergency in your home.

C.     We have to allow 10 days from the banking of a client cheque until we can account to you.  Banks need     this time for cheque clearance.

D.    Rent payments received are usually paid to you on the same day, however please allow upto 3 working day for banking due to weekends and bank holiday

E.     We cannot pay outgoings on your behalf in excess of rents payable to us in your account.

F.      We will question obvious errors on suppliers but will pay bills on your behalf which appear correct.

G.    You must advise your insurers both of buildings and contents insurance of your intention to let, they may advise an additional cover, or exceptions or expenditure which may be necessary.

H.    Please ensure that all water pipes and storage tanks are sufficiently lagged.

I.        Ideal are members of a client money protection scheme and NAEA

There are currently over 400+ rules and regulations that landlords are expected to comply with to remain on the right side of the law, keep tenants safe and avoid hefty fines. With more changes in the pipeline it is becoming more and more challenging to keep up to date and for many landlords this is a time-consuming and costly headache. 

▪	Registering deposits (capped at 5 weeks' rent)
▪	Managing gas safety certificates
▪	Pat testing and fixed electrical testing
▪	Legionella risk assessments
▪	Fit and test smoke alarms
▪	A valid Energy Performance Certificate (EPC), at least grade E
▪	Registration with ICO
▪	General Data Protection Regulation (GDPR) compliance
▪	Checking your tenant has the right to rent the property
▪	More changes being discussed by the government and compliance that's on the way.

The thought of outsourcing all this responsibility to a professional letting agent can seem a very attractive option. In addition, a reputable agent will be able to carry out all the key practical tasks required for a successful tenancy, as well as offering on-going support and advice to ensure the property is protected, profits are maximized and any risk-taking is minimized.    

                                        LANDLORD FEES

THERE ARE 2 LEVELS OF SERVICE AVAILABLE, TENANT FINDER FEE AND FULL MANAGEMENT FEE

Tenant Finder Service

 

For Ideal Estates “Tenant finder service” there is a setup fee of £456.00 (£380.00+VAT)

The set up fee includes agreeing the market rent and finding a tenant in accordance with the landlord’s guidelines. This involves marketing and advertising the property on Zoopla, onthemarket, Ideals website and social media, erecting a board, carrying out accompanied viewings as appropriate. Vetting the tenants for suitability. The checks include landlord references, employees’ references, credit checks, right to rent checks and any other information to help assess the affordability criteria of the applicant(s). The cost of referencing a guarantor is included in the fee.

TENANT FINDER SERVICE	FEE	TOTAL INCLUDING VAT
These following services are optional.
GAS SAFETY INSPECTION	£55+VAT	£66.00
GAS SAFETY INSPECTION AND SERVICE	£100.00 +VAT	£120.00
ELECTRICAL CONDITION REPORT	£110.00+VAT	£132.00
INVENTORY FEE	£50.00+VAT	£75.00
EPC	£75.00inclusive	£75.00
RENT REVIEW FEE	£25.00 +VAT	£30.00
CHECK OUT FEE	N/A
RENEWAL FEE	N/A
WATER BACTERIA TESTING	£100.00 + VAT	£120.00
SMOKE/CARBON MONOXIDE ALARM Checking the alarms work on the first day of tenancy	£40.00 + VAT	£48.00
SMOKE/CARBON MONOXIDE ALARM Arranging the installation of the smoke and carbon monoxide alarms.	£50 + VAT	£60.00
PAT TESTING	£75.00 + VAT	£90.00
NOTICE REQUIRING VACANT POSSESSION	£50.00 + VAT	£60.00
DEPOSIT DISPUTE FEE.	£100 + VAT	£120.00
SECURITY BOND REGISTRATION FEE	£50 + VAT	£60.00

 

 

 

 

 

 

 

 

 

 

 

Fully Managed Service

Ideal Estates “Fully managed service”

There is an initial set up fee of £372.00 (£310.00 +VAT)

The setup fee includes agreeing the market rent and finding a tenant in accordance with the landlord’s guidelines. This involves marketing and advertising the property on Zoopla, onthemarket, Ideals website and social media, erecting a board, carrying out accompanied viewings as appropriate. Vetting the tenants for suitability. The checks including landlord references, employees’ references, credit checks, right to rent checks and any other information to help assess the affordability criteria of the applicant(s). The cost of referencing a guarantor is included in the fee. Supplying a AST tenancy agreement, Handling bond deposits, bond deposit disputes, collecting rents, paying rents, organising maintenance quotes / works, 6 monthly inspections, informing all utility companies, quarterly and annual rent statements, also includes advise on refurbishment and providing guidance on compliance with statutory provisions and letting consensus.

FULL MANAGEMENT	FEE	TOTAL INCLUDING VAT
Monthly Management Fee (Percentage of the monthly rent) This is a monthly commission calculated as a percentage of the months rent, for collection and remitting the monthly rent received, deducting commissions and supplying quarterly and annual rent statements. Arrange maintenance for the property, obtaining quotes for work, dealing with workmen, chasing arrears and helping with disputes		11%
WITHDRAWAL FEE If the landlord withdraws before the tenancy started.	£90.00 + VAT	£108.00
MANAGEMENT TAKE OVER	£300 +VAT	£360.00
These following services are optional. (See full management details)
INVENTORY FEE	£55 + VAT	£66.00
SECURITY DEPOSIT REGISTRATION FEE	INCLUDED
EPC	£75.00	£75.00
WATER BACTERIA TESTING	£100.00 + VAT	£120.00
SMOKE/CARBON MONOXIDE ALARM Checking the alarms work on the first day of tenancy	£40.00 + VAT	£48.00
SMOKE/CARBON MONOXIDE ALARM Arranging the installation of the smoke and carbon monoxide alarms.	£50 + VAT	£60.00
GAS SAFETY INSPECTION	£50+VAT	£60.00
GAS SAFETY INSPECTION AND SERVICE	£100.00 +VAT	£120.00
ELECTRICAL CONDITION REPORT	£110.00+VAT	£132.00
RENT REVIEW FEE	£25+VAT	£30.00

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Example:

Monthly rent £……………..Deduct Ideals fee of ……..% £……….….. Total paid to you £……………………..

 

Client Money Protection is provided by Propertymark. The Redress Scheme for Ideal Estates and Property Management Ltd is The Property Ombudsman Scheme

ALL FEES ARE DEDUCTED FROM RENTAL ACCOUNTS.

 

THE PROPERTY OMBUDSMAN SCHEME

Ideal are also members of The Property Ombudsman scheme and subscribe to This Code of Practice for Letting Agents. Copies of the code of Practice and the TPO consumer Guide is available at our office or at your request. Ideal maintain and operate an in-house complaints procedure which explain how to complain to us and to the ombudsman. These are readily available at our office for consumers. Link to TPOS website is www.tpos.co.uk

NAEA PROPERTYMARK PROTECTED AGENT

Ideal voluntarily joined a professional body The National Association of Estate Agents which means we are bound by a code of conduct. Ideal ensure maximum protection for our clients; offering Client Money Protection, Professional Indemnity Insurance and membership of the TPO.

 By using a NAEA Propertymark Estates Agent you are guaranteed to be consulting with a professional agent who can give you up-to-date advice and guidance

PROPERTY MANAGEMENT AGREEMENT

If you wish Ideal to proceed as your letting management Agents please confirm your instructions by completing the following and return to us.

 

INSTRUCTIONS TO MANAGE A RESIDENTIAL PROPERTY

 

Owners full name(s)   .............................................................................................................

Owners address           ............................................................................................................

                                     ...........................................................................................................

Address of property    .............................................................................................................                

                                    ................................................POSTCODE.......................................

Tel numbers:               ................................................Email …….........................................

National insurance number....................................................................................................

Mortgagee                   ...........................................................................................................

Address                        .........................................................................................................

Roll number of account number........................................................................................

If going overseas, please provide details of tax office, your tax reference and NI number.

..............................................................................................................................................

Letting to commence .................................for...........................................................years

Any special conditions which should be included in agreement ie no children/pets/smokers etc

............................................................................................................................................

Rental income is normally paid into you UK bank account with statements to your forwarding address, please therefore give full details of your UK bank account.

BANK.........................................................................................................................

ADDRESS OF BANK................................................................................................

                                    .................................................................................................

                                    ................................................................................................

SORT CODE & ACCOUNT NUMBER...................................................................

Do you wish to employ any particular tradesmen to carry out maintainance?

If yes please provide details........................................................................................

.....................................................................................................................................

Agreed repair/maintenance limit £.............................................................................

LEGAL COVER AND RENT PROTECTION OPTIONS AVAILABLE

 

Legal cover is available at a cost of £60.00 plus vat (£72.00) per year.

For further details please ask a member of staff.

 

Rent protection and legal cover is available at a cost of £300.00 plus vat per year

For further details please ask a member of staff

 

Insurance is only available to tenants that have passed the rent4sure checks that we carry out.

 

WHY WE USE YOUR PERSONAL DATA

Ideal require and process your personal data for the following purpose, to provide you with the service activated and registered for, for the prevention and detection of crime, fraud and anti-money laundering to enable us to comply with our legal and regulatory obligations. We are registered with the ICO and Ideals privacy policy can be found on www.ideal-estates.co.uk. I / we give my / our consent to the information that I have provided being used for Ideals processes only.

 

14 DAY RIGHT TO CANCEL/ COOLING OFF PERIOD

After signing this agreement you have the right to cancel with-in 14 calendar working days without any costs

or fees. The cooling off period comes into effect when the contract is signed by you away from our office. For

example during a visit to your home, work place, away from Ideals premises or online.

Marketing will commence after the 14 days cooling off period unless stated in writing from yourselves to

market immediately. If you wish to market immediately and then wish to cancel with in the 14 days then a

recovery fee is  £95 plus VAT. Total including VAT £114.00

I/we have read and agree to Ideal Landlords Guide to Management/Letting Services.  I/we hereby

authorise Ideal to act of my/our behalf in the……………………………. of the above property during

the agreed letting period, to sign agreements, to collect rents where due on my/our behalf and take all

necessary action (including court action) where necessary.  I/we have read and understood and agreed

to pay by deduction of rental income, the management and miscellaneous fees (where appropriate) as

set out in the summary of management charges.

 

SIGNATURE(S)................................................................NAME..................................................................

 

 

                          ..................................................................NAME.................................................................

 

DATE……………………………………………..