The management of any let property may prove a time-consuming and onerous task – even if you are only an occasional or “accidental” landlord. Advertising the letting, selecting of tenants, conducting background checks and taking up references, drawing up the tenancy agreement and conducting inventories, all take considerable effort – and that is before you have even started to manage the need for ongoing repairs and maintenance.
It is hardly surprising, therefore, that many landlords opt to share at least some of that burden by instructing a letting agent to act on their behalf.
If this is an attractive solution to the running of your own buy to let business, what needs to be considered when working with letting agencies?
- legal services experts, Landlord Law, recommend that your choice of letting agent may be guided by their membership of the National Approved Letting Scheme or the professional associations which are party to that scheme;
- in the event of any dispute you might subsequently have with your letting agent, it might also be prudent to choose one that is registered with the Property Ombudsman;
- it is important to have a clear understanding of the extent and scope of services offered by a letting agent;
- one of your principal decisions, for instance, is whether the agent is going to manage all matters relating to tenancies of the property, or whether they are to operate a full management service in which ongoing repairs and maintenance to the property are also handled by them;
- a closer and more detailed examination of the service they offer – and perhaps more importantly, the efficiency of that service – might be obtained by looking at similar properties in your local area for which the letting agents are responsible;
- as the landlord, you have a number of responsibilities for the health and safety of your tenants, so it is important to establish whether the letting agent is also going to ensure compliance with such matters as gas, electrical and fire regulations;
- it is also important to be clear whether you remain responsible for placing any deposit from your tenant with an approved deposit protection scheme, or whether this is to be done by the letting agent on your behalf;
- online estate agents, Prime Location, suggest that you might want to consider instructing more than one agent, since many offer a “no let, no fee” arrangement;
- remember, too, that it is the scope of the service offered and the agent’s success in letting your property that is likely to be more important than finding the cheapest fee;
- the more information you are able to provide the letting agent, the better your chances of having the kind of tenant you prefer;
- with respect to those fees, letting agencies typically charge a percentage of the rent you are charging and in return they arrange everything from advertising the letting, finding tenants, taking up references, drawing up the tenancy agreement and conducting inventories;
- fees for a full management service are also likely to be based on a (higher) percentage of the rent you intend to charge.
Letting agencies may help to take the strain out of running any buy to let business. Before signing any contract for their services, however, you might want to keep these considerations in mind.