In our latest blog, our Managing Director, Paul Rock, tells us about his personal experience in renting and just how important it really is to have a letting agent.
How many landlords have put up with average property letting agents? Many years ago, I was one of those landlords.
Let's start from the beginning - you have a property to let. It may be that you are at the beginning of an exciting new business adventure or you may be an accidental landlord, (i.e. through inheritence); regardless of your situation, one of the first steps is to employ the services of a reputable letting agent. With so many agents to choose from where do you start? It's a bit of a minefield isn’t it! On the surface, they all seem to promote the fact that they will surpass your expectations offering you the very best service at the lowest possible fees with the reassurance that they have attended every course, obtained every qualification and have perfect tenants paying the highest rents who pay on time and so it goes on.
Sounds great doesn’t it?! Where do you sign...
... You don’t. How many times have you listened to a sales pitch and think “wow, they were great”, only to later wonder why you didn’t get what you were promised. Due diligence is key here - do your homework. You are asking a complete stranger to manage the most valuable asset you are likely to own and unfortunately the saying "too good to be true" is more often than not the case.
What’s the first thing you do when we want to book a holiday or a hotel? Go on Trip Advisor. Need a tradesman? Checkatrade. When you bought the property you want to rent out did you just take a chance that it would be okay? Of course not; you had a survey and you employed a solicitor to do the necessary checks. So why would you hand your property with keys over to an agent without checking first. Always use the below checklist when trying to decide on the best letting agent for you:
Agent Check List
How long has your prospective letting agent been established?
Do not risk your asset to a new start company. Ideally look for a letting agent with at least a decade of experience - you'll be surprised how often you will rely on your managing agent, and a background of personal experience is priceless.
Ask how many properties they manage.
If they say 100 or more, ask for proof of this. Again, an agent with a small portfolio just doesn’t have the experience, knowledge or knowhow of a larger agent. There will be situations throughout a tenancy that you cannot foresee, and when this happens you need someone at hand who has already been through it and handled the matter carefully.
Ask the agent for their procedures from start to finish.
A good agent will be able to talk you through the whole process and back this up with examples of their work. You don't want to be stuck with an agent who doesn't know how to handles deposit disputes for example, or what to do if the worst happens and your tenant stops paying. This could result in large delays, and even bigger rent arrears.
Ask the agent what they would do if your property needed maintenance or repair work carrying out, especially out of hours.
You will be amazed how many letting agents have nothing in place to facilitate this once their office is closed. Unfortunately in some cases 9 to 5 really does mean 9 to 5. Here at The Letting Company, we have a dedicated out or hours line where you - and your tenants - can reach us whatever the time, and whatever the problem.
Ask the agent how proactive they are in finding prospective tenants then mystery shop them.
A great agent will answer the phone in a polite professional helpful and friendly manner. If you aren't impressed with the first impression, do you think any prospective tenants will be?
They will arrange viewings as quickly as possible especially if the property is empty. If the agent can’t offer a viewing for a week or two, walk away. At the end of the day, this is lost rental income - even a two week delay could be a major loss of £300 (based on a £600 rent).
Enquire as to how many inspections are carried out and do you receive a written report.
You may have the perfect tenant on paper. Sufficient income, great credit score, excellent references from friends - but do you really know them? Checking in on the property every few months is incredibly important as you can nip any issues in the bud before they spiral out of control. If the tenant is keeping the property well, there'll be no issue in gaining entry.
Ask what the agent would do in the event the property is being neglected.
Put yourself in the worst case scenario:
- Your tenant hasn't paid their rent for 2 months and your mortgage company are on your back
- You drive by the property and the gardens are overgrown, and through the window you see the property is in a dreadful condition
- You receive a call from the police advising the neighbours are constantly throwing parties and causing havoc on the street
What would your agent do? You want a detailed outline as to their action plan - how they are working with the tenant to resolve any issues, what they will do to recover lost payment, how they will quickly regain possession, and so on.
You pay them a fee to have you covered in these situations, and to take the worry away.
As and when your current tenant gives notice to leave, ask how quickly and proactively your agent will market the property.
You want as small a gap as possible between tenants. You can't stop your tenants from leaving, and so efficency is the number one priority here. If your agent isn't on the ball in marketing the property, booking in viewings and helping a tenant to apply, it will delay the process.
What are your fees?
Do not underestimate the power of a contract. It is your responsibility to read the contract you are about to enter with a letting agent. Check their duties and what they are offering you for your money. What are their cancellation fees should you no longer require their services? Will they charge you in the event your tenant offers to buy the property? Does the agent take a cut when organising insurance works? Look at the small print for charges not mentioned in your initial meeting - you may be surprised.
Of course, as with any industry or service there are good and bad letting agents - this is why it is vital to do your homework from the outset, hopefully safeguarding yourself against any pitfalls along the way. Remember many agents class themselves as property experts, just make sure they are exactly that.
For more information or advice, why not contact us direct - our advice is free, and we can always help.