By using this website, you agree to our use of cookies to enhance your experience.


BTL investors must think before rushing into a new tenancy agreement

Buy-to-let investors must ensure that they are compliant with current legislation to avoid facing costly consequences, according to Legal Associate Andrew Verlander from FBC Manby Bowdler.

The popularity of BTL investment has grown substantially since pension reforms were introduced last year, coupled with urgency among investors to complete purchases before changes to Stamp Duty are introduced on April 1st

Landlords in particular must be aware of the Deregulation Act, which came into force a year ago and outlined the principal areas that landlords need to ensure compliance for all new Assured Shorthold Tenancies (AST’s).


Landlords must provide copies of the property’s energy certificate and a copy of the government’s “How to rent” booklet, as well as evidence that the tenant’s deposit is being protected in one of the three recognised Deposit Protection Scheme’s.

Failing to comply can impact the landlord’s ability to serve a Section 21 notice to evict tenants. 

Purchases of second or more properties must also be aware of the Stamp Duty changes. The tax implication on a property purchased for £150,000 would at the moment be £500, but from April 1st, this will rise to £5,000.

This is placing urgency on investors to complete purchases quickly, something which Andrew Verlander advises against: “Buy to let investors, both experienced and those who are newer to the market, should be wary about rushing to complete on a property purchase before Stamp Duty changes without given due consideration to their legal obligations.  This is particularly exacerbated when the property has a sitting tenant and the tenancy agreement isn’t compliant with the terms of the new legislation.”

“For the majority of investors, buy to let is a long term commitment and as such we would urge all landlords to take the time to be fully up to speed with what their obligations are.  This should avoid costly consequences at a later stage such as the return of a tenant’s deposit plus compensation, or a quasi-void period when a sitting tenant refuses to pay until an agreement dispute is resolved,” he added.


Please login to comment

MovePal MovePal MovePal
sign up