How To Rent Out Your House Or Flat: Our Guide

Not sure how to rent out your house or flat? I don’t blame you – there’s plenty to think about, but in the long run, the monthly rental payments you receive should make the process well worthwhile!

Did you know that in the UK, out of roughly 23.5 million homes, landlords let out 33% at least to private and social renters according to Statista? The rental market is a valuable source of income for many homeowners.

But before you can make a start, there are some upfront requirements to work through that help get the rental ball rolling. And once you begin renting out to the first tenant, there’s more to do in terms of property management too.

Here’s my 12 point guide to renting out a property for the first time. And at the end of this article, I’ll explain how help is at hand if you just want to do the first few steps yourself and let an expert take care of everything else!

#1 Notify your mortgage provider

When renting out your property in the UK, it’s crucial to inform your mortgage provider to avoid any contractual breaches.

Notify them well in advance and inquire about the necessary permissions and potential changes to your mortgage terms. Failing to inform them may have consequences, including penalty fees.

Ensure compliance with the terms of your mortgage agreement by keeping your provider in the loop about the change in property usage.

#2 Make a call on furnishing, smoking etc.

It’s worth considering market demand, the property condition and any personal preferences to make informed decisions that also align with the type of tenant you want to have.

Furnishing a property often involves higher initial costs, but can help attract younger tenants and those moving from overseas.

Permitting smoking is another personal preference, but be aware that smoke damage can limit potential tenants and may impact property resale value. In terms of allowing or refusing pets, that’s more complicated.

If your property has a leasehold agreement where the freeholder prohibits animals, then you can insist that tenants do not bring pets. Otherwise, in many cases, you can’t unreasonably turn down a tenant’s request to bring their pet.

#3 Estimate your budget

While renting out your property will earn you money, there are some additional costs to plan for as well, including:

• Marketing
• Rent insurance
• Property maintenance
• Landlord insurance
• Income tax on your rental income

You will need to declare your property income and expenditure on a self-assessment tax return form, unless earnings for the tax year are under £1,000 (at the time of writing). However, the good news is that mortgage interest payments qualify for 20% tax relief.

As a landlord, whether you live in the UK or not, to check if you must send a self-assessment tax return form to HMRC, use the tool here provided by the government.

If your property is empty for a while between tenants, also set aside some budget for council tax, utility bills and so on.

And of course you need to factor in the original non-rental specific costs – such as the mortgage, plus ground rent and service charge for leasehold properties.

#4 Work out a competitive rental rate

Setting a competitive market rate for your property is essential for attracting the right tenants and maximising your income.

Conduct thorough market research to understand local property values and tenant demand, but also consider factors like location, amenities and property condition.

Pricing too high can deter potential renters, while vice versa, pricing too low may result in missed revenue.

#5 Check landlord licensing in your area

London and some other parts of the UK have a licensing scheme up and running. Some examples include:

• Selective licensing: Landlords need to apply to their council for a licence and pay a small fee
• Mandatory licensing: This is a prerequisite for a house in multiple occupation (HMO)
• Additional licensing: A council may ask for an additional licence if the council argues that mandatory licensing terms need to be strengthened for a HMO, for example

Check your local council’s website – find it here using the government’s search feature – to see if they have a landlord licensing system in place.

#6 Brush up on landlords’ legal responsibilities

There are plenty of legal requirements for landlords to be aware of. Start by familiarising yourself with your obligations around the following, first and foremost:

• Gas Safety Certificate
• Smoke and carbon monoxide alarm regulations
• Electrical safety regulations
• Fire safety regulations
• Right to rent checks
• Tenancy deposit scheme
• Energy Performance Certificate

For more information, check out the latest government guidance on how to let.

#7 Make a tenancy agreement

When writing a tenancy agreement, clarity is key. Outline terms such as security deposit, rental payment instructions, tenancy duration and how the break clause works.

Specify responsibilities regarding maintenance, utilities and any restrictions. Include clauses on renewal terms and conditions for termination. 

Make sure you comply with legal requirements. Clearly define the roles and expectations of both parties to mitigate potential disputes.

Use reputable templates to ensure your tenancy agreement aligns with UK legislation and safeguards both landlord and tenant interests.

#8 Create a marketing plan

A well-executed marketing strategy enhances visibility and attracts suitable candidates for your rental property.

Wherever you showcase the property in online or offline listings, use high-quality photos and detailed descriptions to attract potential tenants.

Highlight the property’s unique selling points, such as its proximity to the local amenities or any recent renovations. 

Consider offering virtual tours as well as in-person ones, since some tenants may struggle to attend an in-person viewing, particularly those currently based overseas.

#9 Screen potential tenants

Respond promptly to tenants’ inquiries and be transparent about the rental terms. Then when you accept an offer in principle, it’s crucial to get the due diligence right.

Conduct thorough background checks – including credit history, rental references, and employment verification.

Adhere to anti-discrimination laws to ensure fair assessment. Implement the Right to Rent check and other relevant tenant checks.

By diligently vetting tenants, you mitigate risks and promote a secure, compliant rental process while protecting both the property and investment.

#10 Protect the tenant’s security deposit

In the UK, landlords must secure a tenant’s security deposit in a government-approved tenancy deposit scheme within 30 days of receipt. Find out more about the Tenancy Deposit Scheme.

Provide the tenant with prescribed information about the scheme, including its terms and how to resolve disputes.

This legal requirement ensures fair treatment and protects both parties. Securing the deposit appropriately helps build trust between landlords and tenants.

#11 Host a tenancy check-in

One of the best ways to help the tenancy go smoothly is by getting the check-in right at the start.

Conduct a thorough inspection before the new tenant moves in, documenting the property’s condition and taking photos.

Provide the tenant with an inventory list, then ask them to review and sign it. Explain how the utility meters work and share any property-specific instructions.

Also address any immediate concerns and encourage open communication. Comprehensive check-ins help to set clear expectations, prevent disputes and build a positive foundation for the tenancy.

#12 Stay on standby for ongoing property maintenance

While tenants play a key role in day-to-day upkeep and reporting minor problems promptly, landlords need to step in when required too.

They should promptly address and rectify structural issues, ensuring the property continues to meet safety and health standards. Regular inspections can identify issues early.

Establish clear communication channels for maintenance requests, and provide guidelines for routine tasks. A proactive approach to property maintenance upholds the property’s value and ensures a comfortable living environment for tenants.

Final thoughts: How to rent out your house or flat

If you’re daunted by any (or all) of the above steps, don’t worry! That’s what experienced property managers are there for, to take care of the finer details so you don’t have to.

Once you carry out Steps 1-3 to get ready, everything from Step 4 onwards in this guide is something that I can help with. This is particularly beneficial if you’re living outside the UK and need a nearby expert to oversee your property’s tenancy when you rent it out.

With two decades of experience, rest assured that everything from setting a competitive rate to ongoing property maintenance is no trouble at all here at Fine Living. Enjoy peace of mind as you receive the rent – Fine Living is part of the Propertymark Client Money Protection scheme. 

I hope this guide has helped you think about how to rent out your house – but if you haven’t bought one yet, here is my first time buyer checklist. Additionally, here are my favourite questions to ask when viewing a house or flat you’re looking to buy.

If you have any queries about renting out a property for the first time, or you’d like to ask about something in our portfolio, we are here for you! Please don’t hesitate to get in touch.

Want to discuss the advice on this blog - or anything else?