Useful products & services
At British Gas, we’re the experts when it comes to safety with gas and electricity. Because we’re always looking for ways to help our customers, we’ve also put together a list of other products and services that may you may benefit from.
Insurance – a must have for landlords
Landlord insurance is a specialist home insurance policy. It’s the best way for you to protect your investment should something happen to your properties, whether you’re just starting out or have a bulging portfolio to your name.
As you’d expect, it’s best to shop around to find the best insurance policy for your needs.
Why landlords must have it?
A standard home insurance policy won’t fit the bill because it won’t have appropriate or sufficient protection. A landlord's insurance policy will provide a number of other cover options including landlord liability insurance. This will help protect you against compensation claims if someone was injured. Landlord insurance can also give you rent guarantee cover for lost rental payments.
What you get for your money
Just like standard home insurance, there are two types of landlord insurance – buildings and contents. Landlord buildings insurance will help protect the actual bricks and mortar in case of fire and flooding, to name just a couple. If you’ve furnished the property you might want to consider contents insurance too. Your tenants will need their own insurance for their personal items.
Each landlords policy will have different inclusions and exclusions, but most will include:
- Legal cover.
- Rent guarantee cover.
- Landlord liability cover.
- Employees’ liability cover.
Optional extras – these could be offered as extras or be part of your landlord's insurance policy:
- Accidental damage cover.
- Glazing, Locks, Roof & Pest Cover.
- Unoccupied property cover.
Keeping your rental property in tip-top order
There are a number of products and services available to help protect your rental property, and take away the sudden surprise of a repair bill.
Trust the landlords experts
With the British Gas Landlords' service, you'll benefit fully from:
- Unlimited call outs per contract year.
- Parts and labour included.
- Manned customer breakdown line 24/7.
- Over 6000 highly qualified Gas Safe registered engineers.
- 1000 highly trained plumbing and drains engineers.
- 500 highly skilled electrical engineers.
- A call when our engineer is on their way so you can get on with your day.
- Collect Nectar points.
Maintenance and repairs – landlord’s legal requirements
In 2002 the Government introduced a new legislation design to save heat loss through windows and doors in private properties. All glass windows and doors in newly built houses must be double glazed using low emissivity glass. The same goes for any complete replacement windows and doors. You’ll find full details in Building Regulations Approved Document L (Fuel Conservation).
If non compliant units are fitted you could face a fine, plus the value of your property could decrease. If you ever sell your property you’ll need evidence to prove that any replacement glazing since April 2002 complies with the Buildings Regulations. You can prove this by:
- Asking for a certificate from your Local Authority Building Control Service stating that the installation has been approved under the Building Regulations.
- Getting a certificate showing that the work was carried out by a FENSA registered installer.
FENSA stands for the Fenestration Self-Assessment Scheme. It was set up by the Glass and Glazing Federation (GGF) and other industry bodies, at the request of the CLG, to allow registered companies to self-certify that their installations comply with current Building Regulations.
Managing the £s
Letting a property is a business, and just like any other business key its success is a healthy cash flow. Here are some words of advice so you’ll be one step ahead with money set aside to cover your liabilities, including taxes.
Buy-to-let mortgages – do the maths
Before you do anything else, it’s best to figure out how much you want to spend on your rental property before you step foot in a prospective property. You’ll obviously need to consider what your rental income will be too.
Traditionally buy-to-let lenders will look for rent to cover 125% of the mortgage repayments, however many had relaxed this. They’ll want a 15-25% deposit, perhaps more in the wake of problems in the mortgage market, to protect themselves against falling prices. Some buy-to-let mortgages also come with large arrangement fees.
A few things to consider:
- Will the investment work?
- What happens if your property is empty for a month or more?
- Will you have the funds to carry out maintenance and repairs at your property?
Finding a buy-to-let mortgage right now
Investors are now benefiting for lower rates – many have fallen, and the current (March 2012) base rate of 0.5% has certainly helped. However, new mortgage deals are still expensive compared to residential deals.
It might sound obvious, but don’t just walk into your bank or building society and ask for a mortgage. There’s plenty of advice out there, you might want to consider using a specialist buy-to-let mortgage broker. Asking them for information does not mean you’re under any obligation to use them.
Here are tips on finding the right mortgage for you.
The hidden costs
As well as your deposit and mortgage repayments, there are other things to think about:
- Stamp duty
- Legal fees
- Income tax on the profits you make from rent
- Capital gains tax if you sell up
- Landlord insurance
- Maintenance and repair costs
- Furnishing expenses, if you furnish the property
- Letting and managing fees
Before you embark on getting a buy-to-let mortgage and renting your property, be sure you can comfortably budget for all of these expenses.