As buy-to-let mortgages fall out of favour with landlords due to recent changes in tax relief, commercial property has seen an uplift. Property Wire studies show that there's been a 9% growth in commercial mortgages over a two-year period. If you're considering investing in non-residential property, here's the need-to-know, from rules and regulations to what tenants expect from you.
Your key responsibilities
You must legally take on responsibility for the health and safety of a property. Common examples include existing fixtures and fittings at the point of lease and providing safety certificates, as well as making sure there are gas and electricity supplies. It will also normally include maintenance and subsequent repair of the building itself, asbestos and fire safety.
In a few cases, it might be the tenant who's conjointly or solely responsible for health and safety aspects. It's important that such responsibilities are properly clarified when rent proceedings and contracts are created. As an example, additional appliances and items installed by the person renting are their responsibility.
The Zero Deposit proposal
If you are asking for a deposit during or before the commencement of a lease, you will normally draw up a deed detailing the amount due, the terms (including when it should be paid) and the conditions for its release.
However, for landlords working with people who cannot afford a high deposit, there are other options. A recent partnership between The Dispute Service (TDS) and Zero Deposit has created a new scheme which works on the basis of tenants not paying a lump sum but ‘buying an insurance policy’ that guarantees landlords any approved losses.
It's intended that this will help protect landlords if they don't receive their rent. If the tenant doesn't honour their debts, a payment is made by Zero Deposit within 48 hours of the disputed claim being confirmed by TDS. Your tenant is still accountable for the damage and outstanding payments but is now helped by having a professional way to resolve the issues.
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