As a landlord, it is important to understand that there are numerous pieces of legislation that cover the private rented sector.
Failure to comply with the plethora of legal requirements can create substantial financial and criminal penalties for you, along with jeopardising the recovery of a rented property should you ever wish to seek possession.
Ensuring you use you a competent and knowledgeable agent is vital in protecting you and one of your most valuables assets from the consequences of legislation and a much more educated tenant base, who are not shy in seeking compensation with an array of “no win no fee” solicitors in the marketplace.
You will find below a summary of the legal requirements for renting out a property with a link attached should you wish to find out more information on your obligations:
Permission to Let
To be able to legally let out a residential property, you will need to ensure that you have sought the permission of all joint owners, and any relevant mortgage company/freeholder. Failure to do so, maybe considered as fraud.
Energy Performance Certificate (EPC)
This has been a requirement since 1st October 2008, and you are legally obligated to commission an EPC before advertising a property to let. Failure to do so, can attract a financial penalty and, in some cases, non-compliance could allow a tenant to break contract without penalty.
Gas Safety Record (GSR)
A GSR is required for all properties which there is gas pipework/appliances. There must be a valid GSR given to the tenant before they commence occupation, and this must be renewed annually using an approved Gas Safe engineer. It is a criminal offence not to comply.
Electrical Inspection Condition Report (EICR)
An EICR is a legal obligation that states all properties must have safe hard-wired electrical systems and portable appliances. The most efficient way of proving compliance is by conducting an EICR on the hard-wired system and a Portable Appliance Test on any appliances you may provide. When you consider that 80% of house fires start through an electrical fault then it is a logical approach to take.
Legionella Risk Assessments
There is a legal obligation to ensure that the property has been risk assessed for the danger of legionella bacteria. In most cases, the risk assessment only needs to be a simple and proportionate response as the risk in continually occupied rental property is low. Nevertheless, a risk assessment needs to be conducted to prove compliance.
Asbestos Property Survey
The dangers of exposure to asbestos fibres have been well documented and such fibres can be found in any building built or refurbished prior to 2000. The legislation requires you to risk assess the property for the presence of asbestos fibres before any works are undertaken and failure to do so could result in prosecution.
Landlords Repairing Obligation
The legal repairing obligations of the landlord when a tenant commences of the property can be found in Section 11 of the Landlord and Tenant Act 1985. The obligation to keep in repair can be broken down into three facets being structure/exterior, sanitation and finally space/water heating. Failure to comply, can result in tenant compensation claims and issues with being able to claim possession.
Housing Health and Safety Rating System (HHSRS)
A more generic requirement to ensure that the risks to any tenant or occupier are minimised. HHSRS covers 29 areas of risk from excess cold, trips and falls to the perennial problem of damp and mould. As you have a duty of care obligation to all those who occupy and visit your property, it is imperative you have evidence of assessing property risks and taking the appropriate action to minimise such risk. Failure to comply can result in financial penalties being issued by the local council and notices served which may prevent possession of the property being sought.
Tenancy Deposit Compliance (Assured Shorthold Tenancy)
This has been a legal requirement since the 6th April 2007 for a landlord taking a tenancy deposit. The compliance requirements are complex and differ slightly for the three approved deposit schemes in existance. There are strict timescales for compliance with a landlord being obligated to fully comply within 30 days of receiving the deposit from the tenant (note not from when the tenancy starts). Failure to comply can create substantial financial penalties with one recent court decision awarding the tenant 12 times the value of the deposit as a penalty for non-compliance over multiple tenancies.
Smoke and Carbon Monoxide Alarms
Since the 1st October 2015, there has been a legal obligation to install a smoke alarm on each habitable level of a rented property. In addition, where the property has a solid fuel appliance, such as wood burner, then the law requires a carbon monoxide alarm to be fitted. To complicate matters further, there is a compliance obligation to test such alarms on the tenancy commencement date to ensure that they are fully working (note on commencement date and not before). Failure to comply can result in a fine issued by the local council.
Fire Risk Assessment (FRA)
The legal obligation to conduct a FRA will vary from property to property, so the safest default position is to assume that it will apply to all rented property. Ensuring as the landlord, you have installed the requisite number of fire safety and warning systems such a fire blanket and heat detector, can provide good evidence of your due diligence in the event of the worst-case scenario occurring. It will also be prudent that you have looked at the fire escape routes and ensure that these are clear of obstructions and where necessary clearly marked.
This is a brief overview of the legislation surrounding the private rented sector which can have an adverse effect should full compliance not be undertaken. Using a competent and knowledgeable agent is essential in assisting compliance and in addition they can provide vital updates when new legislation is introduced or when there are significant court decisions which will have an impact on a landlord.
Blog guest written by Darrel Kwong of DWK Consultancy
An EICR is a legal obligation that states all properties must have safe hard-wired electrical systems and portable appliances. The most efficient way of proving compliance is by conducting an EICR on the hard-wired system and a Portable Appliance Test on any appliances you may provide. When you consider that 80% of house fires start through an electrical fault then it is a logical approach to take