Being a landlord can be stressful and time consuming. Many people work full-time too, so it can be really helpful to have professional to deal with the phone calls, inspections, contracts and legislation. Our quick guide runs through what you need to think about when choosing a letting agent for your property.
Decide How Much Help You Need
These are the three different levels of service that letting agents usually offer:
1. Let Only – This is the most basic service. Here the agent finds the tenants, checks their references, secures the deposit and arranges for an agreement to be signed.
2. Rent Collection – This includes all of the basic service features, plus collecting monthly rent and chasing arrears.
3. Full Management – This service features everything in the basic service offers and rent collection. Here the agent also handles inspections, maintenance and arranging for repairs.
Of course, the higher the level of service, the higher the agent’s fee.
You can save the extra cost by choosing a basic service. However, you will need to manage the property yourself and keep up with changing regulations. If you’re a busy landlord, a letting agent who takes care of everything can be a blessing. Especially for those with more than one property. But before you let someone else decide which plumber to call, make sure you update your landlord insurance policy.
Find an Accredited Agent
Professional bodies monitor a letting agent’s standards and practices. They are a reliable shortcut to finding firms you can trust. This stamp of approval also suggests those agents have a Client Money Protection scheme and professional indemnity insurance.
So look out for agents endorsed by:
- The National Approved Letting Scheme
- The National Association of Estate Agents
- The Association of Residential Lettings Agents.
Pay Close Attention to Your Contract
Like any contract, you should always read and fully understand every clause before you sign on the dotted line. Here are three key areas which might cost you more than you intended if you’re not careful:
1. Renewal commission
If the tenant found by the agent later renews their lease, the agent may be entitled to their cut all over again – even if they aren’t managing the property.
2. Vacant property charges
The agent is entitled to some form of fee when the property is unoccupied. But, it should be a lower fee than when they have a tenant for you. Otherwise, what’s their incentive to find one?
3. ‘Extra’ charges
Administration, performing inventories and drawing up agreements are all standard extra charges. But make sure you know when they apply and how much you’re paying for them. If an agent wants to charge you hundreds of pounds for providing a tenancy agreement, you’re right to feel suspicious.