The private rented sector has significantly grown over recent years with an increasing popularity among investors for buy-to-lets as a long-term investment.
Many investors and landlords choose to appoint a letting agent to manage their rental property, and with an extensive choice of letting agents to choose from, it is important to appoint the right one.
OnTheMarket.com have therefore provided a guide on what to look for in a letting agent to ensure a property is rented quickly, securely and to an appropriate tenant for the best possible return.
It is wise to appoint an agent located in the same area as the property that is to be rented out. Most towns will have a variety of agents to choose from however many landlords prefer to use those who are members of a professional body such as the Association of Residential Letting Agents (ARLA Propertymark) or the National Approved Letting Scheme (NALS). Agents who belong to a professional or trade bodies will have codes of professional conduct they must adhere to and will have guarantees in place to protect landlord and tenant money.
There are typically three levels of service an agent will offer; tenant-find, rent collection or full management. Tenant-find/Let only, is when a landlord employs the agent to find a tenant for their property however they look after the day-to-day management of the letting themselves.
Tenant-find and rent collection – is when an agent will find the tenant and collect the rent however all other matters are the responsibility of the landlord. A full management service is where agents will take care of everything involved in the letting process from start to finish, including; finding the tenant, collecting the rent and managing any maintenance activity.
Competent letting agents will handle all the paperwork involved with a letting. They will request references for the prospective tenants, carry our credit checks, and confirm the tenant has the right to rent in the UK. Letting agents will also draw up your tenancy contracts and organise the necessary EPC, gas and electrical safety certificates on your behalf.
Marketing, advertising and rent
It is important to appoint a pro-active agent to help find a tenant for a property. Time costs money, therefore landlords will want their agent to find a suitable tenant as quickly as possible once they have been instructed.
Landlords should check that their preferred agent advertises on online portals and websites. Good agents will have a list of prospects on their books who they can immediately offer the property to as soon as they are instructed.
A professional letting agent will also ensure a landlord achieves the best return on their investment by advising on expected rental figures and produce details of comparable properties they have rented which have achieved similar rental values.
Client money protection
Letting agents handle deposits, rent and maintenance floats. It is therefore crucial that landlords appoint a reputable agency that can demonstrate they belong to a Client Money Protection scheme.
Agents should hold all landlord and tenant money in a Client Account, separate from the agency’s general or business bank account.
Rent collection and full management services provided by an agent will include matters concerning the security deposit paid by the tenant at the start of a tenancy. An agent will hold this money on behalf of the landlord as a safeguard against any potential damage the tenant may cause to the property. By law, deposits must be registered with a government approved scheme. Agents should provide landlords and tenants with details of the scheme they are part of and supply confirmation that the deposit has been registered.
Letting agents should help landlords ensure that their property is compliant with all safety legislation. Gas safety inspections must be carried out annually, by a qualified gas engineer, and a certificate must be supplied to all tenants when commencing a tenancy. Many agents will organise safety checks on behalf of landlords however it is important for landlords to follow up on these as ultimately the responsibility lies with them.
Repairs and maintenance
A full management service should include regular property inspections to ensure the tenant is keeping the property in good order and to check if there are any maintenance issues. A professional agent will have a network of contractors who they can call upon for maintenance or repairs.
Letting agents who will be looking after the full management of a property will usually have the authority (as pre-agreed with the landlord) to carry out necessary or minor repairs up to a certain value without contacting the landlord. It is usual then for the agent to hold a sum of money as a maintenance float to enable them to carry out the repairs as and when needed.
Accounting to the landlord
Landlords should check with their agent the arrangements they have for accounting the rent received and charges in relation to the property, and how they plan to transfer the balance to the landlord’s account.
Content provided by OnTheMarket.com is for information purposes only. Independent and professional advice should be taken before buying, selling, letting or renting property, or buying financial products.
Full article available OnTheMarket.com: https://www.onthemarket.com/content/11-tips-for-choosing-your-letting-agent/