'Generation rent' is predicted to increase, as the proportion of 16-24-year-olds renting privately has grown from 51% in 1998/99 to 73% in 2017/18, and from 20% to 46% for 25-34-year-olds. So, is this a good time to become a landlord? Becoming a landlord could bring you some extra monthly income, as well as providing an option for investing your savings.
But you might want to know what counts as a landlord? What are your responsibilities if you do decide to become one? And what are the costs involved? This article will guide you through how to become a landlord in the United Kingdom. You'll find all the information you need on the various aspects of being a landlord, from landlord insurance to tenancy agreements.
We'll go through what, exactly, is a landlord, the benefits of being a landlord, your responsibilities and legal requirements as well as the potential costs involved. You'll soon have a better understanding of what's involved in being a landlord, and how to meet regulations if you decide owning rental property is an exciting venture for you.
What is a residential landlord?
A resident landlord is a landlord who lives in the same shared house or flat with their tenant(s). If you live in different parts of the same property with someone who is paying you rent, then you are, by law, a resident landlord.
This includes properties where there have been a loft or basement conversion, or if part of the garage has been turned into a bedroom or annexe. However, this doesn't include if you live in separate flats which are in the same building or block.
If you're considering renting out part of your current property, it's important to check if you need any permission before signing a tenancy agreement. If you own your current property and have a freehold agreement, then you shouldn't need any permission before becoming a resident landlord. However, if you have a mortgage, or own a leasehold property, you'll have to get consent before sub-letting your property.
If you decide to become a landlord there are some good benefits involved, that include:
- You can give less notice to end a lease. This is due to the possibility of relationships breaking down between landlord and tenant, in which case you may want to be able to evict the tenant quickly, as you are living in a shared property.
- You could be eligible to earn up to £7,500 tax-free rent per year with the government's Rent-a-Room scheme.
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