As the property market has been going through a slump over the past few years, more and more people are now struggling to sell properties for reasonable prices. For some, this just means not being able to move home as quickly as they like. For others, it means owning a superfluous property that is a drain on their resources. There has been many cases where someone has come into owning a property, through inheritance or by other means, yet they have been unable to sell it due to the current market.
Those in this situation eventually have no other option left than to let the property out so they can afford to pay Council Tax and other fees. There is a term for those that have found themselves in this situation, and that is accidental landlord. As we have discussed in our other resource articles, becoming a landlord is not something that should be taken lightly, and so many accidental landlords struggle at first when it comes to managing a tenancy.
However, as the issue has become so common, help is more readily available, especially as it is a top priority of the Government and local authorities to keep the private rental sector at a high standard. At Just Landlords, we also offer help, so if you need more information then read on…
Why can’t I just leave the property empty?
This is a question that nearly every accidental landlord thinks when they find out they are unable to sell a property without making a huge loss. They often feel it would be easier to just leave it unoccupied until the market recovers and they can sell the property quickly and easily. However, the fact of the matter is that empty properties cost money and this money will ultimately have to come out of your own income on top of your other expenses.
The costs of unoccupied properties include:
- Council Tax – If you own a property, then you are in charge of paying the Council Tax. For those that have inherited a property, you have six months until payments kick in, however, this doesn’t allow a lot of time to find a buyer.
- Damages and maintenance – Unoccupied properties are huge targets for thieves, as with no one there to protect them, it’s very unlikely they will be caught. If your property is broken into or vandalised, you will have to pay in order to replace any missing goods or repair damages.
- Squatters – Squatting is illegal in private residential properties, however, this doesn’t always act as a deterrent. If you leave your property empty for too long, you may come back to find it occupied by unwelcome guests!
So what should an accidental landlord do?
If the likelihood of you selling your property is extremely low, then you may just have to accept your fate and become an accidental landlord. Luckily, the private rental sector is doing extremely well right now, so if you have a good quality property, you should be able to find a tenant in just a short amount of time. Furthermore, as there is such a huge demand for private rental accommodation, the yields a property can provide can be extremely high, meaning you may end up benefitting from your unexpected situation.
On the other hand, if you really know that being a landlord is not right for you, there are other options you can explore. For example, you can pay a letting agent a small fee to look after your property on your behalf, meaning you will only have to spend a minimal amount of your time organising a tenancy. You could also see if there are any landlords or letting agents in your area that are looking to expand their portfolios and would be happy to take the property off your hands. Just be careful with this route though, as if you seem desperate to get rid of your property, you may only receive low offers.
Even though having the responsibility of being a landlord sprung on you can be disconcerting and stressful at first, there are things you can do to make your situation easier. You could even find that you have a hidden talent for letting properties!
- Empty Homes Statistics 2012. (n.d.). Retrieved from the Empty Homes website: https://www.emptyhomes.com/statistics-2/empty-homes-statistics-201112/
- Council Tax. (2014). Retrieved from the GOV.UK website: https://www.gov.uk/council-tax/second-homes-and-empty-properties
- Tax man and lenders target accidental landlords. (2013). Retrieved from the Landlord Zone website: https://www.landlordzone.co.uk/news/tax-man-lenders-target-accidental-landlords
Disclaimer: This article is for information only and is not official guidance, FCA approved, or legally precise. Just Landlords has used all reasonable care in compiling the information but make no warranty as to its accuracy. If you require information on landlord legislation or best practices please contact your legal representative. For details see our conditions.