1. Always, always reference tenants. Make no exception to this rule. Remember – con men succeed because they are persuasive. Never allow tenants to have the keys until you have checked them out.

2. If you have any doubts whatsoever about a tenants ability to pay rent, take a guarantor. Make sure you reference the guarantor also

3. Do not give tenants a long fixed term. If they prove unsatisfactory it will be difficult to get them to leave before the fixed term ends and you may be stuck with them for longer than you wish. Six months is about right for a new tenant.

4. Serve a section 21 notice early on (although not on the same day that they sign the tenancy agreement – about a week after they have moved in perhaps). If this upsets the tenants, say that you hope that you will not have to use it, but that you are serving it as a precautionary measure.

5. Get into the habit of checking rent payments so that you will be able to contact the tenant as soon as a payment is missed. It is if rent arrears are allowed to mount up that big problems generally occur. If you deal with things promptly tenants are less likely to allow arrears to develop.

If you follow these five steps your tenants will be less likely to fall into arrears and you will be in a better position to deal with it if they do.  Note that if you are unfortunate enough to have teants fall into rent arrears, my rent arrears action plan can help. 

Do you agree with my five tips? Do you have any tips for precautions landlords can take? In your experience are more tenants falling into arrears nowadays?

This is day 29 of my 31 days of tips on tenancy agreements series. To see the rest of the series click here.

Preparing tenancy agreements

After having sourced your tenancy agreement and found your tenant, you need to get it ready for your tenant to sign.  Here are a few tips for you:

• Make sure that you have all spellings correct, ie of such things as the address of the property and the names of the landlord and tenant.

• If possible have the agreement details typed rather than handwritten.  Handwriting is often hard to read, and if it is misread this could cause confusion.

• Generally try to have the agreement looking clear and professional.  A scruffy  photocopy with scrawled handwriting will not reflect well on you as a landlord. After all this is the document which will govern how the tenancy operates, and may well one day be scrutinised by a Judge (for example if you need to evict the tenant).  Take care with it.

• You need to have two copies, one for the tenant and one for you.  Traditionally the landlord will sign one copy and the tenants will sign another, and then swap them over, so both have a copy of the agreement signed by the other.  However there is no harm in having both parties sign both copies.  You only do one copy for the tenants even if there are several of them.

• If there is more than one tenant sharing on a joint and several basis, they should all sign the same agreement.

• If there are any other documents to attach (such as an inventory, house rules, insurance policy terms, headlease etc) they should ideally be initialed and dated by both parties at the same time as the tenancy agreement is signed.

Signature

So far as signature is concerned, the first thing to say is that if at all possible you should make sure you have a tenancy agreement with all the tenants original signatures on before you let them into the property.

Faxed or scanned copies, could prove problematic, and are not recommended.  Although I understand that some landlords have done this without problems – maybe this is because they have had good tenants and the validity of the tenancy agreement has not been called into question.

Under no circumstances should you let the tenants into the property before signing the tenancy agreement.

Once they are in, they can, legally, refuse to sign anything (whatever they may have told you previously), and the only way you can get them out is via a court order for possession.

I would also recommend that, where agents are instructed, the landlord signs rather than the letting agent (unless the agent has power of attorney).  In practice it would be very difficult for a landlord to refuse to ratify an agreement signed on his behalf by his agent, however it could cause problems.

Some tenancies need to be ‘signed as a deed’.  What does that mean?  It means, basically, that the tenancy agreement should say it is signed as a deed, and the signature should be witnessed by someone independent.  This means someone other than the other party to the agreement!

As mentioned on Day 12,  because a tenancy agreement is a ‘document of title’, it needs to be signed as a deed unless the exception set out in section 54 of the Law of Property Act 1925 applies.  This section says that so long as

• the term is less than three years,
• the tenant is paying a market rent, and
• the term starts immediately,

the tenancy will be valid if there is just a signature.

So if you are arranging for the tenancy agreement to be signed by the tenants a long time before they are due to move in, or if you want to give the tenant a three year term, or if you have agreed to an exceptionally cheap rent, you will need to sign as a deed.

Stamping

A tenancy agreement is a ‘stampable document’ and previously stamp duty was payable (particularly prior to December 2003).  However now stamp duty is only payable for tenancies with a rent of over £125,000 pa. If you need any further information about this see the HM Revenue & Customs website.

Do you have any comments on this section?   Do you have any views about the legality of faxed or scanned signatures, and agents signing on their landlords behalf? Have you ever experienced any problems with tenancy agreements not being signed as a deed?

Tomorrow I will be looking at renewals.

NB Read about my tenancy agreements service here.

*****

I was talking to one of our newest landlords recently; he’d just got his first buy-to-let property and he was excited to get it listed with us – but there was one problem. “Well,” he told me, “all that estate agent lingo, I don’t know how to write it.” I’m sure he’s not the only landlord who’s had that thought, but actually, he didn’t need to worry. 

If you want to get your property let quickly, writing a good advert is essential. But while sounding professional is important, that doesn’t mean you have to write in jargon or a bunch of obscure abbreviations. A clear and complete description of just what you’re offering is all you need:

1) Location, location, etc.  This is probably the most important criterion, but you’d be amazed how many people get it, well, inaccurate. Don’t say “central London” if you mean Camden, or Barnet. Don’t say Brighton if you mean Hove. Don’t say Manchester if you mean Salford – because you’re not only putting off the people who want to live in Manchester, but anyone who wanted a Salford property would be ignoring your ad too. Pitching your property as being in a more desirable location than it really is doesn’t help anyone. 

Most property portals these days use Google Maps or something similar to pinpoint exact locations; give them an accurate address and postcode so that your property can be included in this. Vagueness about location just puts tenants off.

2) Furnished, or not? Because different people’s interpretations of just what “furnished” means can differ so wildly, it can be worth being more specific here. If kitchen white goods are provided, say so: “unfurnished; has washer/dryer, fridge, microwave” is better information than just “unfurnished”, or even “part-furnished”. 

3) Property style  Here’s your chance to be a little bit creative. You don’t need to go over the top – a couple of words can be enough, particularly when you’ve included some great photos with your ad. “Light, airy, modern”, “traditional classic style”, instantly conjure up an image of what your property might be like. And if it’s tiny, you can always call it “cosy”. ;-)

4) Indoor space  Now we get to the meat of your ad: what exactly are you offering? Mention the number of  bedrooms and their size, but also reception rooms, kitchen and so on. If it’s newly decorated, or recently re-carpeted, then say so. Adverts for studio  properties in particular often need more clarification than they get: if the kitchen is separate, say so. If you can include a floor plan in your advert, so much the better.

 5) Outdoor space If your property has a garden, it’s crucial to mention that. Likewise if you have an ultra-desirable garage. Even if it’s a tiny terrace just big enough for a chair or two, the promise of a chilled glass of wine outdoors on a summer’s evening will certainly attract more prospective tenants.

6) Entrance  If your property has its own entrance, it’s worth mentioning that specifically. Shared hallways can be a source of friction, and the thought that they won’t have to deal with other people’s cooking smells, junk mail and visitors can be an attractive one for your tenants.

7) Transport links  Mention the Tube lines, train station or bus routes closest to your property (with distance) and you’ll help your prospective tenants visualise living there. You’ll also make it more likely they’ll turn up to view in the first place. 

8 ) Other amenities Do you offer broadband, a power shower, off-street parking, a concierge, an alarm system, a cleaner, even if just for shared areas? Say so! Again, every extra feature you can offer should help to pull in potential tenants.

9) The legal stuff Saying “deposit and references required” might seem so obvious you wouldn’t need to say it, but it does demonstrate you mean business and you’re taking a professional attitude to your letting. If that puts anyone off, it’s someone you wanted to put off anyway!

It can also be worth mentioning the length of tenancy you’re offering, particularly if it’s not the standard six months. You also need to mention the rent of course – it’s worth giving the figure as both weekly and monthly, because we’ve all come across the tenant who thinks that a month’s rent should be four times the weekly figure.

10) Listing through Upad makes it easy: when you’ve registered as a landlord, there’s just one simple form to fill out to list your property on more than 100 different sites. And we’ve got LOTS of tick-boxes for you to highlight your property’s unique features, so you won’t have to do too much writing.

Avoid  the voids and find your next tenant with Upad.co.uk: list your property on 100+ rental sites and portals for just £59 until let.