Making the decision to rent out a room in your home is quite a big one, and one all occupants in the home should talk through. However, with more and more families feeling the pinch as the economy tightens, more and more people are looking at taking in a lodger. There are certain incentives too, you can earn up to £4250per year tax free from the income your room generates.
The price of the room vary from area to area. Typically the room will be furnished, minimally with bed, desk and wardrobe space. A double room may have a single or a double bed. The room should be let inclusive of the council tax, water rates, TV licence, gas and electric bills. Rents in Surrey are normally IRO 65 - 100 per week and varies from area to area and its facilities in a given locality. It is normal for the lodger to share your kitchen and space should be provided on shelves and in the fridge for their things. Bathrooms can be shared and an ensuite will command a higher rental. Use of other rooms is an agreement between you.
Whilst many homeowners advertise the room in the private ads, some letting agents will charge a small fixed fee for introducing a tenant, though viewing's are normally conducted by the property owners as its important that you like the prospective lodger and you get a good gut feeling. Once you are happy with your prospective lodger you should look at taking references. A previous Landlord to call is reasonable and an employment reference. Its important to build a picture of who your lodger is. An agent can carry out credit checks, employment checks and affordability checks through referencing agents to ensure the person is employed and can afford the rent and have no adverse credit history. After all, you don't want a lodger registering bad debt at your home address, or not paying the rent because they have numerous obligations eating into their income. Its certainly worth getting an Agent to conduct the tenant referencing.
If you have children in your home or vulnerable adults, you may want to go one step further and have a CRB check, but regretfully these are harder to have carried out. I spoke at length today with the CRB on why Letting Agents are not allowed to apply for these on the Landlords behalf as when you are letting a lodger stay in your home (where all your personal data is stored),especially if you have children, you want to ensure the person has not previous convictions. Fortunately, Surrey County Council have assured me today that in the forthcoming months, this may change and whilst the cost of such a check will be £50-70 - it may give added piece of mind. Surrey County Council are at least showing a proactive reaction to the dilemma and are offering assistance, though it may still take a few weeks to get a check through. Watch this space as I will update with news of this, but for many this may be very welcome.
Homeowners often make the mistake of not getting a solid and water tight agreement in place. The Tenancy Agreement should be a common law agreement, and it falls outside of the Housing Act. Basically, both parties need to mutually agree its contents and sign. A period should be agreed as should notice periods and rent due date and how rent should be paid. However, that's the basics, and a good agent will advise you on essential contents. Food for thought - you may have excluded dogs and cats - but what about fish? If the fish tank bursts and the carpet is destroyed, does you tenants room insurance cover this, or will it be down to you to claim? Avoid the problem by ensuring your agreement excludes anything that may be a risk.
For more information on how to go about Letting a Room in your home, please contact SurreyLets. Our advice is free and there is no obligation.
I always understood that insurance was protection against something that might or might not happen (e.g. fire, theft), and assurance was protection against something that was bound to happen sooner or later (e.g. death).
ReplyDeletelandlord contents insurance