If you rent out property, you’re in business. For a professional landlord with a portfolio of properties yielding significant income, that principle goes without saying. However, there are a huge number of landlords who don’t see themselves as being in business.
Who are these unintentional landlords? They’re the cohort of property owners who first buy a residential property and live in it as their home. Later they’ll buy or move into another property and choose to rent out their previous home. But they’ll often still regard the rental property as a home rather than a business asset to be exploited for profit. They’ll see the rent they earn as topping up their income, rather than being just as much a part of their income as what they receive from their employer or other business activities.
Why does this matter? Because businesses of any description are subject to legal regulation. And it can sometimes come as a surprise to landlords that the property rental business is one of the most heavily regulated types of business. Analysis from the Residential Landlords Association shows that there are over 140 Acts of Parliament containing over 400 regulations governing the renting of residential properties.
Single property landlords often find these regulations are a heavy burden and they consider the cost of complying with the regulations to be an unreasonable expense being paid for out of their pockets. But it may help to see the bigger picture: this is a business asset and whilst there are costs connected with having it, it is earning you profit. Complying with the law is simply one of the costs of doing business and every landlord, no matter how large or small their portfolio, needs to take that cost into consideration in their financial planning.
Analysis by the Residential Landlords Association (http://www.rla.org.uk/) has shown that there are over 140 Acts of Parliament containing over 400 regulations affecting the private rented sector. This is a figure that will grow substantially when the Housing and Planning Bill becomes law. To suggest the rental market is some sort of lawless desert is not just ludicrous, but also a lazy approach that avoids having to carefully consider how we ensure that the criminal landlords are found and held to account.