A landlord’s guide to frequently used terms you may hear when renting out your property
Admiral Insurance estimate that one third of the British population now lives in rental properties. They’ve compiled this list of frequently used terms if you’re renting. It’s aimed at potential landlords, but we thought it was so good we thought we’d share it here.
If you think Admiral Insurance’s list is helpful, they’ve asked if you’ll pass it on. After all, every landlord needs to buy their insurance off someone…
Accidental landlord – A time where you didn’t buy your property with the intention to rent it out but you’ve found yourself in a position where you need to.
Arrears – Late or unpaid rent that the tenant owes you, the landlord.
Buy to let – A property that you’ve bought (usually with a mortgage) with the intention of renting this property out as a source of income.
Contents cover – This would apply to anything you own within the property that isn’t fixed or fitted there. For example, if your property comes furnished, any free standing furniture would need to be considered for contents cover.
Department for Social Security (DSS) – This department actually no longer exists within our government. But it is still seen within the rental property realm as it usually relates to whether or not a tenant can rent your property while claiming housing benefits. You may see the phrase ‘No DSS’ which would mean someone claiming this benefit can’t rent the property.
Energy performance certificate (EPC) – It’s a legal requirement to have this certificate when renting out your property. Your EPC shows how energy efficient your property is and a rating between A-G. Properties rated F or G must meet Minimum Energy Efficiency Standards (MEES) – see below.
England landlord register – It’s not a nationwide requirement in England to register as a landlord as it in in NI, Scotland and Wales. But in some parts of England it is mandatory, so always check if you need to register your property with your local authority.
Eviction – The enforced removal of a tenant from your property. This can be for a number of reasons including failure to pay rent or malicious damage to your property.
Fixed term tenancy – A contract between you and your tenant where the start and end dates are fixed.
Gas safety inspection – Inspections carried out every 10-12 months by a Gas Safe registered engineer. They inspect all gas appliances in your property to ensure they’re safe for your tenant. If the inspection is passed you’ll be given a certificate to prove this.
Gas safety certificate (CP12) – A certificate given once a successful gas safety inspection has been carried out. It will have full records of all previous checks too.
Gas safety record (GSR) – This is where the gas engineer that has performed your gas safety check will record the results. This includes any certificates (CP12) and any gas safety inspection failures.
Guarantor – This is usually a friend or family member of your tenant who has agreed to accept responsibility and pay for any missed payments or damage your tenant causes if they cannot pay for this themselves.
The Housing Health and Safety Rating System (HHSRS) – Your local authority conducts this for your property. They assess any risks and hazards your property may have, such as mould, fire risks, asbestos etc.
House in Multiple Occupation (HMO) – This would mean at least three people rent your property but are not from the same family so wouldn’t be considered one household.
HMO licence – If you want to rent out your house as an HMO (as described above) you’ll need to contact your local authority for this licence.
Landlord liability insurance – Insurance that covers you against injury or damage claims relating to your property. We call this Property Owner’s Liability. For more information see our landlord insurance page.
Letting agent – A third party that can help you find tenants for your property, manage the contracts around the rental agreement and can in some instances also manage the property for you.
Loss of rental income cover – If your tenant has to move out due to something covered under your insurance policy, i.e flood or fire, this may lead to a loss of income. You may need to provide alternative accommodation for your tenant or stop charging rent while the property is being repaired. Luckily, in this instance we provide cover for loss of rent or alternative accommodation on all our landlord policies which you can increase up to £100k.
Malicious damage – A time where a tenant has intentionally caused damage to your property.
Managing agent – A third party (this can be the letting agency) that manages the tenancy and tenants for you. Tenant requests relating to the property and general inspections would then be handled by your managing agent.
Minimum Energy Efficiency Standards (MEES) – Applicable to all rental properties in England and Wales with an energy efficiency rating of F or G. Under government plans to lower CO2 emissions, it’s now illegal to let properties with an Energy Performance Certificate (EPC) rating below an ‘E’ rating.
Permitted payments – These are payment you can legally charge your tenant, such as a refundable deposit for tenancy, payments to change the tenancy agreement, a charge for late payment of rent or early termination of contract.
Prescribed information – This relates to your tenants’ deposit under the Tenancy Deposit Protection which is a legal obligation. You must let your tenant know where the deposit is held.
Property inventory – This inventory ensures a documented record for you and your tenant describing the contents of a property and the condition of those contents. This inventory should be taken at the start of a tenancy and agreed by both parties.
Reference – Once your tenant is on board, with their permission you or your managing agent will conduct reference checks on their background and financial security. This may involve checking the tenant’s previous tenancy, credit checks, affordability checks and Right to Rent checks.
Right to Rent – Applicable in England only. This is a government check to ensure your tenant is legally allowed to rent a residential property.
Subletting – If your existing tenant rents out all or part of your property to another person, this person would then be known as a ‘subtenant’. In most cases your tenant may need your written permission before they can do this, depending on your contract with them.
Tenancy Deposit Protection (TDP) – You must hold your tenant’s deposit within a government approved deposit scheme: Deposit Protection Service, MyDeposits or Tenancy Deposit Scheme.
Tenant – The person or people you rent your property to who are listed on the tenancy agreement.
Wear and tear – This is damage or natural changes you may see in your property or its contents due to everyday use by your tenant.
White goods – You may hear this term referring to any large electrical appliances within your property like the fridge, dishwasher or washing machine.
If you would like to discuss something related to a property valuation please contact Zah direct via email at email@example.com or call 020 8947 7040.