To furnish, not to furnish or to part furnish your rental property is your decision as a landlord. Whichever course of action you decide upon will bring its own benefits and drawbacks. Whether the level of rent you can charge is affected depends on the type of tenant you wish to attract. For some tenants an unfurnished property, which can be furnished to the tenants' style and taste, could be a much more attractive option than making do with the landlord's style and selection of furniture.

???Did you Know???

There is no legal definition of a furnished, unfurnished or part-furnished property.

Considerations for landlords

Furnished


1.    You are likely to attract tenants who are in a hurry and want to move in immediately.

2.    Void periods between tenants are likely to be shorter.

3.    You may be able to claim a wear and tear tax allowance against your rental income.

4.    You might be entitled to claim the cost of replacing furniture.

5.    You have the responsibility of ensuring that all furniture and furnishings comply with relevant legal rules and regulations, for example the Furniture and Furnishings Fire and Safety Regulations 1988 and 1993.

6.    Lets may be shorter as tenants do not have to consider removal costs when moving house.

7.    You will be responsible for insuring the contents.

8.    There may be a possibility of claiming an 'unoccupied' council tax discount or exemption during void periods.

Unfurnished


1.    Tenants are likely to stay for longer as they generally have to pay to transport their furniture.

2.    Tenants can use their own furniture so may feel more at home in their own surroundings with their own style.

3.    Tenants may be attracted to unfurnished property as they won't lose their deposit if they damage their own property.

4.    You may be entitled to council tax discounts during void periods.

5.    Tenants will be responsible for insuring their belongings.

6.    You are not responsible for ensuring that the furniture complies with relevant legislation.

Part-furnished


1.    A compromise - you can decide to provide as little or as much furniture as you wish.

2.    This is a flexible option which may make it easier for you to attract tenants.


Whichever option you decide to go for, make sure that as a landlord you comply with your legal and insurance obligations, and encourage your tenants to take out contents insurance.


Find out more about landlord insurance from Direct Line for Business. View original article To Furnish or not to Furnish your Buy-to-Let Property?

If you're eager to get going in the buy-to-let property world, then buying a property at auction will not only enable you to avoid the lengthy negotiations and processes which house buying normally entails but you could bag yourself a bargain.

As soon as that hammer falls then the property is yours but how do you actually become a successful bidder?

Before the auction

1.    Locate an auction - look in newspapers and magazines, ask agents, follow up auction 'for sale' boards.

2.    Find a property (also known as a 'lot') - request a catalogue from the auction house. Generally, there is a three to four week time period between catalogue publication and the auction date so you'll need to act fast.

3.    Do your research - arrange to view potential properties several times. If you plan to do work to the property, take a builder or an architect with you so you can check that you have realistic expectations. Research and compare the property and investigate its market value.

4.    Finances - ensure you have adequate finances. Generally, you will need a 10 per cent deposit on the auction day. The 90 per cent balance will become due 28 days after the auction. Arrange the mortgage in principle.

5.    Legal - obtain a legal pack from the auctioneers and familiarise yourself with it. Seek independent legal advice. Conduct relevant legal property searches.

6.    Do an auction dummy run - auctions can be nerve racking so it might be worth going to an auction as a spectator to see what it's all about.

7.    Check whether a deal can be done before auction - not all properties have to be sold on auction day. It might be possible to purchase before the event.

Auction day

1.    Register - you will probably need two forms of identification. Additionally, you must have a 10 per cent deposit. Don't forget your banking details.

2.    Arrive at the auction early.

3.    Obtain an addendum sheet in case there are any alterations/additions to the catalogue.

4.    Ensure you can see and be seen by auctioneer.

5.    If you can't attend on the day check whether you can place your bid by phone or in writing.

6.    Bidding - set yourself a limit. Don't get caught up in the moment! If you don't think you can handle the pressure then get someone to bid on your behalf.

7.    Use clear gestures - raise your hand or nod/shake your head.

8.    The auctioneer will look around the room and take bids until there are no more. If the reserve price is met the property will be sold to the highest bidder. The sale is confirmed when the hammer falls. At that point the bidder is under a binding contract.

9.    The auctioneer's decision is final. The auctioneer can choose to refuse a bid with no explanation.


After the auction

•    If the property failed to meet its reserve price during auction find out whether you can do a deal now.
•    If you are the successful bidder check when the balance of the property money is due.
•    Remember to take out Landlord Insurance - the risk passes to buyer immediately.

Advantages of buying at auction

•    Bargains available.
•    Fast process.

Disadvantages of buying at auction

•    Expenditure (time and money) - legal fees, valuation/surveys, mortgage, etc.
•    No guarantee the property will be yours.

Jargon

Addendum: Additions or amendments to the property catalogue. This could be in writing or announced by the auctioneer.

Bid: An offer to buy a property at a specified price.

Catalogue: Details of the properties available at auction, viewing terms and conditions of sale.

Gavel: The hammer used by the auctioneer during the auction.

Guide price: The amount which the property is expected to sell for.

Lot: An individual property.

Reserve price: The lowest price the vendor will accept.

Auctions can be a great way of buying a rental property and have many advantages but make sure you're aware of the associated pitfalls if you decide to go down this route. Happy bidding!

Useful links for further information:

Royal Institution of Chartered Surveyors: www.rics.org

Find out more about landlord insurance from Direct Line for Business. View original article Going, Going, Gone... To You: A Landlord's Guide to Buying a Property at Auction

Before you start renting out your property it is essential that you are aware of your legal obligations and responsibilities as a landlord. Failure to comply with the relevant legislation could result in fines and/or imprisonment.

The duties and obligations listed below are not exhaustive and you are urged to seek independent legal advice for the full range of duties with which you must comply.

Gas

The Gas Safety Regulations 1998 stipulate what a landlord must do in relation to gas appliances, flues and pipework.

In brief, you must comply with the points below.

•    Arrange for a Gas Safe registered installer to annually certify that the gas appliances and flues provided for tenants' use are safe and give a copy of the certificate to your tenant within 28 days of the check being completed and/or before any tenant occupies the property.
•    Keep a record of all gas safety checks for two years.
•    Maintain gas pipes, appliances and flues.
•    Before re-letting a property, make sure all gas appliances are safe - including those left behind by a previous tenant.
•    If using a managing agent, ensure the contract specifies whether the landlord or agent will arrange the gas maintenance and safety checks. N.B. As landlord, you have overall responsibility to meet your legal duties.

Smoke Detectors and Carbon Monoxide Alarms

Although not a legal requirement, installing a smoke detector and carbon monoxide alarm could save your tenants' lives.

Depending on your circumstances you may be required to fit smoke resistant doors, fire extinguishers, smoke blankets and fire exits to protect your tenants.

Electricity

You must comply with the Electrical Equipment (Safety) Regulations 1994.

In summary, you must comply with the points below.

•    Ensure all electrical equipment and appliances are safe and free from defects.
•    Remove all unsafe electrical equipment and appliances.
•    Keep records of all electrical checks performed.

Plugs and Sockets

The Plugs and Sockets etc. (Safety) Regulations 1994 require landlords to ensure that all plugs and sockets comply with appropriate safety standards and that the correct fuse is used.

Additionally, the Regulations state that the live and neutral pins on plugs must be part insulated so as to prevent shocks when removing plugs from sockets.

The above guidelines are not intended to be a comprehensive guide to your legal duties. For further information regarding your legal obligations you are advised to seek independent legal advice.

For further legal obligations please refer to Legal Know How for Landlords: A Landlord's Legal Obligations Part 2.

 Find out more about landlord insurance from Direct Line for Business. View original article Legal Know How for Landlords: A Landlord's Legal Obligations (Part One)