Renting a property in London as a foreigner

August 28, 2019
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Renting a flat as an expat? Well we are going to give you everything you need to know in this article! I particularly love working with expats and foreign clients, since I’m an expat myself, having moved over about eight years ago. In this article we’re going to cover all the key things you need to know when you’re renting a flat in London, including some particular tips that you need to watch out for.

The first thing to start when you’re considering renting a flat or moving over to London is your budget. Now the average price for a two-bedroom flat in London is about £1,750 and in today’s exchange rate that’s over $2,000 per month and it’s been as high as maybe $2500 or $2800 dollars a month so it’s very significant. Many people have lots of visions of where to live in London but the reality is, the closer you get to prime central London, where most of the jobs and the shops are, you’re going to be spending even more, but as you get into London you’re actually going to realize you probably want to be a little bit further out in areas like zone 2 or 3 but the most important thing is to make sure you consider your commuting and your transport make sure to watch my recent video on the transport options of London because you’re going to want to figure that out and factor that in to where you’re living.


As well other key criteria you want to think about beyond budget is amenities – what type of a property do you want? I recently put out a video talking about the different property types of London and they could include having a flat with your own garden, you could want a house, you could want a terraced property, you could want an older property if you want something that’s more charming. All of those things are going to factor in but my big tip is to make sure you try to have a clear sense of what you’re looking for but do be realistic because in London I always say when I’m working with my buyers or renters there’s definitely going to be trade-offs. I try to narrow down the list to about three or four key criteria that you’re going to have to have, so for example, I was recently working with a client who’s got pets – that’s going to be really restrictive in terms of our options in London, so if you’ve got that as part of your must-have criteria you’re definitely going to have to be more flexible on different elements of the property search.


Once you’ve considered your budget and your area and the criteria that’s going to drive you, now you can start searching. Most people start their searches online and they’ll use key portals such as Rightmove and Zoopla where you’ll have to put in your criteria and your budget and other restrictions you might have, and see what comes up. Once you see properties that might suit your criteria you’re going to contact the local agent and arrange for viewings, my tip as an agent myself, is to make sure that when you’re dealing with that agent, that they have a clear sense of your criteria because a lot of agents will actually book in your viewing for the property you called about but then also show you other properties, and on one hand that’s good but a lot of times that can be very time wasteful for you because they’re not really listening to what you need and their job is to get rid of the stock that they have so they’re not really working on your behalf. It’s really important to be clear when you book your viewing what properties you’re actually going to be seeing and allocate enough time make sure that they’re not taking you to stuff just to check-in that they’ve done a viewing.


Once you’ve done a viewing and maybe you found the right property, the thing that is unique to London is you can make an offer. In the States we’re not really used to making offers we’ll pretty much accept that the asking price is the asking price and you go with it, but here in London you are able to make an offer and put in any key criteria that you’re going to have to have.


A lot of properties have furnishings, so you want to make sure to say if there’s particular pieces that you want or don’t want, you want to ask for that upfront. When we work for our renters, I encourage them to put an offer in writing clearly stating what your issues are, if there’s any maintenance or repair issues you’ve identified you want to make sure that you put that in writing as well and if you can get the landlord to get it into the lease you want to make sure that you do that once your offer has been accepted.


Most agents will ask for a holding deposit, there’s been a load of changes since the 1st of June that you want to make sure that you’re aware of and I have made a video showcasing the recent changes and how they’ll impact you as a tenant and one of the big changes is, while you have to put a holding deposit down, it is capped at one week’s rent so agents can no longer take two and three weeks rent which they had been able to do in the past.


The key role of the holding deposit is to secure that property for you, subject to tenant referencing, so you now know if you passed tenants referencing that that property is likely yours, it’s not guaranteed until you’ve signed a tenancy agreement and you’ve paid all your money, but it means that it’s going to give you the time to get through tenant referencing, so once you start tenant referencing, you definitely want to make sure you respond as quickly as possible.


Having said that, be prepared to probably not pass tenant referencing as an expat or foreigner moving to London. Why? Because one of the key criteria they’re going to want to see is that you have a UK bank account. Now, you’d love to go get a UK bank account but one of the restrictions or one of the things you’re going to need to get a UK bank account is a permanent address, so it’s a bit circular as you can see that you need an address, don’t have an address, need a bank account to get it address, don’t have…anyway it’s all messed up so the point is if you’re not able to pass because you don’t have a UK bank account, be prepared that most landlords or lettings agents will require you to pay a certain number of months up front, that’s typically anywhere from six months to maybe you can get away with three but be prepared that you’re going to likely have to pay up to six months rent in advance, subject to you getting a bank account. Again, when I’ve let out properties we’ve had that restriction and the tenant has requested that if they get their bank account in months two and three of living there then when the next six months is due they can return to a month by month payment and most landlords will be okay with that, if that was the one issue that was an issue at the time of tenant referencing.


Once you’ve passed tenant referencing and now you’re signing your lease, you need to make sure that you’ve reviewed that lease because it’s between you and the landlord. The other key feature that we find in London in the UK that I wasn’t used to seeing in America is what’s called a “Break Clause” that gives typically, again, it’s a negotiated concept, but if you ask for a Break Clause it’s going to be likely that the landlord also has a break clause. So say you have a 12 month lease that has a six month Break Clause with a two month notice it means that starting from month 4, either party, if that’s what’s been agreed, can give a two month notice, say that at the end of the two months they are terminating the lease and the landlord can take the possession back with no other costs, no legal requirements, or anything like that. So again if that’s something you want to consider, let’s say you’ve been repositioned in London on a 12 month assignment that has the possibility of you moving somewhere else halfway through that assignment, you might want that Break Clause but if you’re given that break cause it means the landlord can have one as well. The only reason why that might be an issue is say you haven’t been a performing tenant the landlord can then look to just merely give you notice and you have to be out.


Once you finish that tenant referencing, signed the contract, and paid your money, you’re going to be prepared to have an inventory check-in. I’ve had a rare situation recently where we didn’t have an inventory, I don’t know why a landlord wouldn’t do that because they’re leaving themselves exposed but be prepared that there’s going to be an inventory check-in report and check out report. This is a documented report, it should be done by a third party which is going to list out all the conditions of the property as it was presented to you they’re going to look at the walls, they’re going to look at cracks, they’re going to look at any stains, are going to look at, if it’s a furnished property, the condition of the furnishings, such that that will be compared at the end of your tenancy to the condition you’ve returned it in and if there are any damages that go beyond normal wear and tear, the landlord can seek compensation.


That reminds me you’re typically going to have to pay a security deposit which is now capped at five weeks rent for tenancy values under £50,000 per annum and capped at six weeks rent for tenancy values over £50,000 per annum so you want to make sure you’re clear on how much security deposit you’re going to have to put in place. With that security deposit that should be held in a government sponsored or government approved tenant deposit scheme so the landlord shouldn’t be holding it personally in their personal account, that is not allowed, it should be held off-site or in a third party and which has a process to review any claims, if at the end of the tenancy the landlord is now seeking renumerations for damages that they’ve claimed you as the tenant has made and there’s a formal process to do that.


Now that you’ve finished the inventory check in and you’ve moved into the flat and you’ve got all the keys and you’re happy and ready to go, remember you’re going to have to put utilities in your name and again one thing you need to really be prepared for & this is my BONUS TIP – is to be prepared for additional costs of renting a property, which includes not just utilities but also you’re going to have to pay TV license as well as council tax, again that’s a concept that most foreigners might not be used to, but council tax is really for the services associated with living in that community such as trash collection and those types of things, so again that’s an expense that a landlord can pass onto tenants so you need to be prepared to factor that into your budget.


So with that, I’ve given you all the key steps and things you need to consider when you’re renting a property in London to make sure it goes as smoothly as possible for you, do let me know if you have any questions in the comments.

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