Checklist for Letting to a Lodger

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A lodger is where the occupier “shares accommodation” with the landlord.

Preparation Before Letting

• Have a clear plan that considers the cost of investment, running costs, cash flow, and rent level.
• If necessary, obtain permission from your mortgage lender and freeholder to rent the room.
• Understand the kind of lodger you are willing to accommodate. Decide if a lodger needing Housing Benefits is an issue. Determine whether the room will be furnished or unfurnished.
• Run realistic calculations to ensure the rental income will cover all associated costs. If not, budget to set aside money from earnings each month to cover any shortfall.
• Establish the likely market rent for the room.
• Decide whether utility charges are included in the rent.
• Consider who will manage the property and the cost of this. If using an agent, agree on costs and levels of service.
• Make sure your insurance policy is suitable for having lodgers.
• Be clear on the tax implications and inform Revenue and Customs accordingly.
• Consider joining a landlord association and doing some professional development.
• Ensure the property, including the room to let, is safe and healthy for all occupants or visitors.

Where there are more than two lodgers, the property will be a House in Multiple Occupation (HMO):

• Check with your local authority whether a licence is needed. If so, apply for a licence and comply with the relevant HMO regulations.
• Ensure a fire risk assessment is carried out under the Fire Safety Order.

Before the Lodger's Arrival

• Verify the lodger's ID to ensure they have a "right to rent". Keep a copy of these documents for at least 12 months after the lodger leaves.
• Check the lodger's score with a tenancy assessment report and obtain necessary references.
• Provide your lodger with the gas safety record before they move in.

When the Lodger Moves In

• Formulate a lodger agreement and sign it together with the lodger.
• Pass on all relevant contact details for reporting repairs and other issues.
• Notify the local authority of the new lodger's details if you are entitled to the single-person discount before the lodger moves in (as the discount will be lost).
• Maintain detailed records of all rental activities, including income and expenses, repair requests, inspections, safety checks, and a rent statement.

When the Lodger Moves Out

• Arrange for a joint inspection of the room and agree on any damage or decoration that needs rectifying.
• Provide information about any cleaning required.
• Make arrangements for the return of keys.