A Landlord's Guide to Weekday Renting

Introduction

Taking in a lodger is a great way to make a bit of extra money, in fact the advantages are more than just financial. Sharing your home Monday to Friday with a lodger is not rocket science, but it does require some careful planning and thought.

The fivenights.com team have put together this step-by-step guide to help you find your way through the property rental maze. We hope you find it useful. Don’t forget we are more than happy to answer any questions you may still have after reading this guide, just visit www.fivenights.com/information/contactus.aspx

Why are You Renting?

The obvious and most popular reason is for the extra income, which can make a huge difference to your monthly budget, but this is not always the only reason. Some people want the company and security that having someone else in the house offers, others want a drinking buddy and positively welcome loud music!

Take a moment to think about what sort of person you want to share your home before you do anything else – it with will prevent problems later on.

Before You Advertise

Depending on your financial situation, there is likely to be a number of people you need to speak to before renting out your spare room:

  • Tell your mortgage company that you are taking in a lodger
  • Your home insurance policy will probably not cover taking in a lodger so you will need to review your policy and if necessary have it amended.
  • If you live alone and claim a reduction in your Council Tax, then contact your local office and find out how having a lodger affects your position (remember to mention they are only a five night lodger!)
  • If you are in receipt of state benefit, the extra income may affect your status, if in doubt, then double check.
  • If you intend to use the “Rent a Room Scheme”, then you should visit the HMRC website, or speak to your local tax office - which can provide far more detailed information.
    In summary, you are entitled to £4250 of your income tax free (or £2125 each for a couple sharing a house), beyond which any additional rental income should be taxed along with your other income. However you are not eligible to offset this income for wear and tear on the property, for example.
  • If you are a tenant at your property, you must have the agreement of your landlord to take in a lodger.

How Much Rent to Charge

Don’t just pull a number out of the air. Compare your property to other properties in the vicinity. In particular the room size, facilities and amenities available nearby. This is very important, because any prospective lodger will certainly be doing the same! Charging the highest rent, or even an average rent is not necessarily the best strategy for making money from your spare room.

Setting the rent slightly below the market average may reduce the amount of time your spare room lies empty, which is a smarter move in the longer term. Above all be realistic in setting the price, the current financial conditions mean that many people will be in the same boat as you, and so there may be considerable competition for the best lodgers.

Finally, remember that you are advertising your room for only a portion of the week, so you need to adjust the rental level accordingly. You should be looking to charge around 5/7ths or 70% of what you would charge for full-time room.

Deposit

It is a common misconception to set a deposit of one month's rent. There are in fact no hard and fast rules as to how much deposit to charge. The purpose of the deposit is to provide a lodger with sufficient incentive to look after your property and not to disappear with rent arrears, and that TV you were kind enough to put in their room. Setting the deposit too high, however, will discourage a lot of prospective lodgers before they have even seen the room.

Deposits can be the source of huge dispute between you and your lodger, and you should strive to head off any complications as early as possible. We recommend defining “wear and tear” and “damage” in your lodger agreement (the former being acceptable and the latter not). All work to repair damage should be done by an experienced contractor - possibly after obtaining several local quotes if it's a large piece of work. Replacement items should be replaced “like for like” from the deposit. If you have vetted your lodger thoroughly you should not have major problems in this area.

Remember also that the deposit is not your own money. It is a good idea to keep it in a separate, dedicated account, and as a measure of goodwill return any interest it has accumulated in the time you have held it. Agree up front how long after the lodger has moved out that you will hold onto the deposit. This is to give you enough time to uncover any previously unnoticed problems with the state of the returned room

Prepare Your Property for a Lodger

So you have decided to let your spare room, you have thought it through carefully. You have spoken to all the necessary parties regarding the impact of it on your mortgage, home insurance etc. You are now ready to place your advert, and compete with several other landlords for the best, most reliable lodgers. To make sure you get one of those best lodgers, you need to know what they expect for their money and match it.

The house should be clean, pleasant and fit for purpose. Try to develop an eye for the things that a lodger would be looking for as they take a look around. This section is designed to help you get a tick in every box on any lodger's mental checklist.

The House

Outside

The outside of your house, and the front garden are going to be your potential lodger’s first impression - and as they say, you never get a second chance to make a first impression! If it doesn’t have adequate “kerb appeal”, the lodger will drive straight past – it's that simple. Make sure that the garden is tidy, the path is weed free, your house number is clearly displayed and there is a doorbell or knocker on the front door

Inside

Make sure that the house is clean, ( would you rent a room in a dirty house? do you want to attract only the sort of lodger who would?)  and smell fresh -  no pet or stale cooking smells.

Any evidence of a pest problem and you will be wasting your time.

If you do have pets, make sure that they are controlled, and the house is not full of cat or dog hairs.

Ensure there are no protruding nails or screws in the floor or walls that could be stood upon, or could catch bare skin or clothing.

If possible, it's a good idea to have the place ready for a lodger to move into straight away, even though you don’t want to be actually moving this quickly. A lodger will walk away with a good impression if you have an orderly, well run household and you are simply waiting for the right lodger to come along. In addition, you don’t want to have to show someone around whilst explaining that that annoying leaky tap will be fixed by the time they move in, or that the boxes stored in the spare room will not be there.

Gas Safety

As a landlord, you are legally responsible for ensuring all the gas appliances in your property are safe. This is easily done by getting an annual safety check. Please be sure that the engineer who undertakes this is registered with the Gas Safety Register.

Electrical Safety

Have all your electrical appliances checked out by a qualified electrician, a PAT (Portable Appliance Test) is probably necessary to check that all of your TVs, kettles etc are in safe working condition. If your house is older, or if you plan to have more than one lodger, it is advisable to get a full electrical safety check, including PAT test and wiring check.

Energy Performance Certificate

The Energy Performance Certificate is a document showing the current energy rating of a property as well as suggested ways in which the energy rating could be improved. The EPC is a compulsory part of the Home Information Pack. It is unlikely that this would be considered mandatory for renting a room to a lodger on a five nights basis, especially if the agreement you have with them is to include energy bills, however this can be obtained from a surveyor if you feel it is necessary.

A EPC is most likely to be useful if you do not intend to include energy bills in the rent. Our advice is to include energy bills in the rent, which circumvents this and other issues relating to payment of bills, when the heating is on and so forth.

Fire Safety

All furniture manufactured after 1988 should comply with the 1988 Fire and Safety Regulations. Check that items such as your sofa has this - if not, replace.

Smoke Detectors

A house built after June 1992 must have a smoke detector fitted on every floor. Every smoke detector in the house should be tested in the presence of the lodger when they move in, and then every week or so. A overly sensitive smoke detector can be a bit of a nuisance, but it should be a part of your agreement with your lodger that they are not tampered with or in any way disabled.

Parking

You may have advertised your property as having its own parking. We advise that a property is marketed as having its own parking if there is an allocated, off-road space available for the lodger to use exclusively. For example, a driveway, garage, or parking space allocated specifically to your property. If a parking permit is required in your area, this should be obtained on behalf of the lodger.

The Spare Room

A fivenights lodger is a different sort of person to a typical lodger, and has slightly different requirements. Anticipating and meeting these requirements will get you off to a head start, for example: 

  • This is someone who lives a long way from where you live (too far to commute), they probably have their own home and life there, and are not seeking to establish another in your area.
  • Time is likely to be at a premium for them, they will spend a lot of time working (maybe in the evening too), travelling, and keeping in touch with loved ones. For this reason, you should be considerate that they may want to spend a larger amount of time than usual on the telephone or using the internet to communicate. These issues can be worked out as part of the house rules (see below).
  • Your lodger will be in effect, treating your home like a hotel!

They will be looking for things like a comfortable clean bed, and a hot (accessible) shower. The room should be furnished with this in mind, and it should be furnished when you show them around – don’t make excuses, don’t plan to use their deposit to furnish the room.

Provide the following:

  • Bed
  • Dresser
  • Wardrobe
  • Bedside table with reading light and alarm clock.
  • A good desk and chair with desk light.

Check with any potential lodger if they need anything else in the room, this shows flexibility and is sure to impress. You have advertised the room with internet access, check this works.

Use your discretion as to whether you want to provide a phone in the room, you may wish to discourage them tying up your phone line!

Electrical equipment should be checked for safety (see above) If you agree to providing clean bedding, then do so on a weekly basis. Decor should be neutral white or beige, a freshly painted room gives a better impression. Carpets and curtains should be clean and again, neutral.

Check that the radiator(s) works correctly, bleed if necessary – can they be turned off or down? Ensure that windows open and close securely. Make sure the bedroom door closes completely and easily. Don't forget to check that there are working bulbs in all of the lights!

Other Services

As part of your agreement, you may wish to charge for other services such as a cooked breakfast/evening meal, laundry and ironing. Any additional income should be treated as rental income for tax purposes.

Vetting the Prospective Lodgers

Having signed up with Fivenights.com, and placed a room advertisement, you should soon be getting emails from interested would-be lodgers. Alternatively, you may wish to make contact with someone advertising a room wanted.

Before You Meet

Following the initial email contact, it's a good idea to talk to the person on the telephone. If you find you have lots of questions then maybe ask them if they wouldn’t mind filling in a quick questionnaire instead of grilling them for an hour! In this way you can weed out unsuitable candidates and save yourself some time, it's easier this way too.

The Viewing

All being well, the lodger will be eager to see the room. The viewing provides the all important face to face meeting where you can tell a lot about the person and whether you are likely to get on. Arrange a viewing in daylight hours, preferably with a friend present. Not only is this safer, a more complete impression of your property can be gained when it’s not dark. Your friend can help with the assessment of the prospective lodger. Remember you don’t need to be best buddies, unless that’s what you are looking for, but you will want a positive impression of them – that they are clean and tidy, quiet, considerate and responsible.

You will be looking to establish a rapport with the prospective lodger and do ask open ended questions. Remember that you are “interviewing” them just as much they are you. Get as complete a picture of them as you can at this point. Where do they work? Do they enjoy it? What do they like to do with their spare time? Do they have friends in the area? Where do they live now and why they want to rent a room? All these things will give you a picture of the person and help you decide whether you want to rent your spare room to them. If you have a lot of questions, it’s probably best to hand them a questionnaire or send one in advance that they can fill in.

Check Them Out

If you feel that you are able to offer the room to the candidate, then the next step is to check out their background. Don’t fall into the trap of not checking them out thoroughly because you feel you are a good judge of character and you don’t need to.

Background Checks

It’s professional and responsible to undertake external checks. A good potential lodger will not object to this level of scrutiny. The sorts of checks available are credit checks, and police checks – links are provided below. Consider charging your lodger for these, and tell them in advance and obtain permission to make them. You may wish to consider further levels of checking. If you have requested an employer's reference, and we recommend that you do, then follow it up with a quick email message or phone call to the referee.

Contact Information

Take enough contact information to be able to contact the lodger at all times. Refer to the Application Form document for detailed information, however you should collect :

  • Home/Weekend Number
  • Mobile Number
  • Work Number and Extension
  • Email Address
  • Work Email Address
  • Home postal address
  • Work postal address
  • Next of Kin Name, Address, and Contact Telephone Numbers

Do they have any friends in the area?

Agree Terms

Before you let someone move in, it's extremely important to draw up and agree upon the terms. This should be a written and signed document in which the “house rules” are laid out. It will not be so easy do later on, especially if you don’t agree on everything. Do not let your new lodger move in until you have such a signed document, and you are satisfied with the results of the background checks you carried out.

What Should Go Into The Agreement?

Here is a list of some of the things you should cover in your agreement:

  • Your name and full contact information including next of kin
  • Your lodger’s name and full contact information
  • The expected start date of the agreement
  • The end date if known.
  • The notice period you or your lodger will provide to end the arrangement.
  • The amount rent agreed, on what day it will be paid and how. A standing order removes the chance of it being forgotten, and saves you having to ask for it. Provide a receipt for all money collected from the lodger or use a rent book.
  • The amount of deposit taken. Agree when it will be returned and under what circumstances deductions will be made and how much. 
    Bills form part of the advert, but agree proportions of those that are not, and when they will fall due, and how they will be paid. 
    Access to the spare room by the landlord at weekends. Whether the lodger is able to leave personal effects in the room. House Rules
  • Noise levels and hours.
  • Visitors, especially overnight visitors.
  • “Leave it as you found it”.
  • Agree private and communal areas
  • Usage of areas where there is likely to be conflict e.g. bathroom, kitchen.
  • Parking and parking permits
  • Locks and keys – charges for lost keys
  • Room inventory
  • Telephone - when it can and cannot be used. 
    Length of the time spent tying up the house line, because they will be away from home they may want to spend a lot of time talking to their family.
  • Use of laundry facilities including iron and ironing board.
  • Space in freezer, fridge and kitchen cupboards.
  • Washing up/loading dishwasher.
  • Damages.
  • Levels of heating in the house (the lodger should have the ability to set their own levels in their room)

Monday to Friday

Since fivenights.com offers rooms to rent during the working week only, you may take it as a given that the lodger will be completely vacating the room at weekends. But there's no harm in reiterating this in case of any confusion. Get agreement in advance on exactly what this means, for example:

  • Can the lodger leave personal effects in the room at weekends?
    If so, how many? A holdall? Clothes in the wardrobe? Does the lodger understand that the room is yours and for your use at weekends? Including having friends stay over and sleep in the bed?
  • What time exactly will the lodger be vacating the room/house, when will they be back?
    Obviously, a little flexibility goes a long way, but be sure that you get what you need from any compromise you agree upon.

Further Information

  • For companies offering reference collecting and background check services, visit Landlord Zone
  • For lodger agreement forms, and futher information on taking in a lodger we recommend Amazon: