How do we select the best tenants for us?

Hi Kaps,

If you are not using an agency for your first rental can I confirm you are comfortable with all the regulation and paperwork that is required. eg Deregulation act, Tenants Fees ban, Deposit protection requirements, gas safety etc etc.

Reply to the comment left by Neil Patterson at 20/08/2019 - 10:17
Hi Neil, I just checked with openrent and they provide Gas and Electric certifcate. We still have 1 month to sort out these formalities before tenants will move in.
For the deposit scheme, again openrent offers doing that for us.
We will also have landlords insurance including legal cover just to be on safer side including registration with Rent Smart wales. Not sure if there is any up to date guide or checklist that we can refer to.

Thanks
Kaps

Reply to the comment left by kaps z at 20/08/2019 - 10:54
Please don't think of the tenant referencing as a formality. It is the most critical thing you do as a Landlord alongside making sure you/your agent has provided all the required paperwork at the right time (much is required to be proved to be provided before the tenancy starts so you will need written confirmation of that).
Not all references are equal, as a landlord I have been horrified by Agents obviously 3rd party agency requests for minimal reference details via App/text for outgoing tenants.
I always contact the previous as well as current Landlord, request proof of residence via bills of addresses not found on the system, and if there are question marks request a guarantor. As you are starting out it might be best to only accept tenants who qualify for Rent Guarantee Insurance which will pay out if the tenants do not.
This may seem a hassle but its nothing compared to getting the tenant from hell or someone you have to constantly chase for rent arrears which keep mounting up.
I would also consider have the 2 guys been sharing accomodation for several years or is it very recent? Statistically its more likely, they will fall out/one will move in with a partner/get a new job than the couple move. On the other hand the couple could have a track record of moving every 6 months. Theres no reason you can't go back to them and ask a few questions before deciding.

Do a jointly & severally liable contract. Get any remaining tenant to find the new housemate and then you take over and get involved with whatever requirements you have.
The cost of the kitchen is best incurred ASAP if you take a long term view on the investment as this will enable you to reject more tenants from subsequent applications.
Assuming any remaining tenant is up to the initial task of finding a suitable house mate, you need to stress that this takes two months to achieve or they will be liable for the full rent until the end of term. If you see any indication that they will not be up to this then do not take them on in the first place.
This will minimise voids and maximise profits.
Do the necessary paperwork regarding tenant changes yourself or you will live to regret it.
I am not sure what "for lettings" really means in detail.
Are you using some sort of agent?

Reply to the comment left by Darlington Landlord at 20/08/2019 - 17:31
Thank You @darlington landlord for your detailed advise there. As you mentioned, i will also get involved in the reference check by contacting the landlords.
For rent gurantee insurance i will check now as you advised. The prospective tenants advised they have been living in the current house from last 4 years and now they are looking to go for 2 bedroom instead of 1 bed.

I wonder if there is any list which I can refer when it comes to reference check like what documents i should ask, or the right questions to ask to tenants. Are we in legal right to ask those documents as they contain personal information. Any advise would really be appreciated.

Reply to the comment left by Paul Shears at 20/08/2019 - 19:39
Thanks @Paul Shears for your input. Apologies if lettings is not the right word. I advertised the property myself with Openrent - online agents. They offer services like agreement creation and rent collection. I assume you mean that i should get more clauses added to the agreement such as if 1 housemate leaves then they are liable for 2 months ? I am not sure if i could do so given if we use openrent service to create rental agreement for us but I will certainly check.

So far we are keen to let couple take the flat subject to reference and affordability checks as they have been renting for last 4 years in one flat so they may stay long..Not sure if this thinking is right, but please correct me if i am wrong.

Reply to the comment left by kaps z at 20/08/2019 - 21:20
We can never be sure about these things. You should go with your gut instinct once all the necessary risk reduction is complete. I suspect that the couple might be less trouble but I have little to go on here. Good luck to you.

See if CPS homes will manage your property. If they will that's fine but it seems to me as new landlords you are taking a path 20 years experience tells me still not to take.
CPS Homes website will show you the modern standard expected. If the block of flats is dubious ditch it quickly.

Know your city, take advice and invest wisely. Plan everything long term and always avoid the tenant who is too keen to complete the AST. Try Van Milert for your referencing they always seem thorough.

I also ask for a list of bank transactions proving their income over the last 6 months and if they are currently renting then a list of bank transactions showing their rent being paid on time every month. If they are keen for the property then they will not argue about providing this. If they did then I would be wary as I have had tenants in the past lie about income and being up to date with rent.

Reply to the comment left by kaps z at 20/08/2019 - 21:11
I would recommend you join your local landlords association if there is one or, as you mention Rentsmart Wales, the RLA, and get detailed advice from them. I know the RLA has details of everything you need to legally do. Its well worth paying a (tax deductable) membership fee to an association for the advice and help, plus you can usually get discounts on things like buildings insurance too. The government has published a "how to rent booklet" which you can easily find on google but it doesn't cover lots of things that you as a real life landlord need to consider.
Have you actually met the couple and the 2 friends? I find talking to people and gut feel can make a difference. In terms of £50 per month less for the couple if you think they will stay longer its much better than having a void of up to a month after 12 months and that doesn't include any costs to fix wear and tear and readvertise.