18 March 2011 – Landlords – need a helping hand?
Take the hard work out of being a landlord with these 10 things a property management agency can do for you…
1. Value your property
A management agency can help you value your property for rental income to ensure the price is pitched correctly for the current market and help prevent you underselling your asset or overvaluing it and potentially encountering periods of void. “A professional property agent will be able to supply a landlord with an accurate valuation on the property,” says Luke Mason, proprietor of Belvoir Hitchin. “They will research the area to advise of similar properties locally and what they have achieved, they will also know what type of tenants the property should attract and how long it would typically take to let. On the valuation they should provide landlords with their legal obligations as a landlord, what they should do to make the property more attractive and guide them through how the process works.” But always be realistic and do your research of the local markets too and pick the agent that you trust the most. “Don’t always go for the agent that gives you the best possible rent projection,” says Lee Shuell, proprietor of Belvoir Oldham. “This may not always be achievable and could result in your property being empty for longer than necessary and ultimately the agent having to reduce the price.
2. Find a tenant
If you let a management agency look after your property for you, they will find the tenants on your behalf. Most agencies offer a ‘tenant-find only’ service or a more involved full-management service. “In terms of finding tenants we advertise with all the popular property portals,” says Major Mahil, proprietor of Belvoir Birmingham Central. “Tenants that register on our website automatically get emailed our properties when they become available too. And also, as a pro-active agency, we tend to contact our tenants on a weekly basis once they are registered with us.” But Lee Shuell warns, “Always ensure that you are aware of what type of tenant is going into your property – if you nstructed either no animals or no Housing Benefit ensure that these terms are kept to.”
3. References and credit checks
“These are absolutely essential, completely critical,” says Terry Lucking, proprietor of Belvoir Peterborough, Corby and Cambridge. “Unfortunately, it’s easy to produce fake references these days (it’s not hard to get hold of headed paper or create your own on the computer), so on-line credit checks are the most valuable source of information – and not all individual landlords have access to them.” A property management agency can gather employer’s references, bank references, next of kin details and personal references, plus they can ensure there are no County Court Judgements against the tenant and that they are clear of fraud indicators. Luke Mason says, “A professional property agent should undertake credit checks, employment references and, if applicable, a previous landlord reference too. However, landlords should be cautious which credit referencing agency the property agent uses – a lot of small companies have opened up offering these services yet fail to spot important information which could play a huge factor in offering the tenant a property.”
4. Handle deposits
“Under law and changes to the Housing Act 1988 all deposits after April 2007 have to be protected by law. If a deposit is not protected within 14 days of the tenancy then the landlord can be fined up to three times the deposit amount should it ever proceed to court,” says Major Mahil. “At Belvoir Birmingham Central our deposits are held within the Tenancy Deposit Scheme (TDS). And tenants are given the correct prescribed information within the tenancy and a certificate to show their reference number and amount of deposit held.” Terry Lucking agrees and says that an agent is the best person to handle deposits as they have experience, plus will be able to make objective judgements when it comes to returning them. “There are two forms of deposit,” says Terry. “There’s a reservation deposit (which becomes rent when the tenancy starts) and there’s a damage deposit. It’s just as easy for a landlord to register a deposit as it is a property management agent but if the landlord is letting the property themselves they’ve got to consider whether they can be objective. It’s inevitable that they will develop some form of working relationship with the tenant and when it comes to the end of the tenancy are they going to be able to look at the damages and access fairly, or are they going to feel they can’t charge them as they know them? Not only is an agent more objective but they also understand how to access for damages because of the various training courses they have been on.”
5. Organise specialist insurances
“Belvoir have a number of insurance products which we can offer to all our landlords,” says Major Mahil. “These include rent guarantee, buildings and contents and home emergency covers.” It is also vital that you are insured for malicious damage caused by the tenant or a visitor, plus accidental damage. Terry Lucking adds, “When purchasing insurance check the un-occupancy clauses, plus that you will be covered for any accidental or malicious damage by the tenant or a visitor. Where possible, use the agent’s insurance as they are likely to have a good relationship with the insurer so any claim can potentially be much faster. Plus, the agent can keep both the landlord and tenant up-to-date with what’s going on – if a problem occurs communication is the key.”
6. Market the property
“One thing many landlords take for granted is advertising and getting the property visible on the internet,” says Terry Lucking. “It sounds simple but if you’re a private landlord it’s not easy at all as you’re going to be competing with so many people who are paying to be seen through search engine optimization and the main portals. It’s essential to choose an agent who is visible in all the main portals.”
“At Belvoir Kettering we take marketing very seriously and advertise on more than 52 websites at any given time,” agrees Harpreet Garcha, proprietor of Belvoir Kettering. “Online marketing and social media are the way forward. We also encourage client feedback and respond professionally should any negative comments be made.” Luke Mason adds, “A good agent will have a marketing package for all properties. I believe that it is essential that the property is advertised on rightmove.co.uk, which is one of the UK’s largest website portals. Professional photographs should be taken too. A property should not take longer than three weeks to let in this climate and, if it does, the agent should review the marketing and refresh it if needs be.”
7. Compile inventories
Inventories are an essential part of the letting process but can be time-consuming to put together. However, invaluable for proving the condition of the property before tenants move in and when they move out, they should never be overlooked. “All our inventories are written and backed up by at least 100 pictures and the details of each property are closely monitored, such as ensuring all meter readings are taken,” says Major Mahil. “We list everything, including makes and models of appliances and also colours of doors, as well as ensuring the condition of the property is noted.” A well-conducted inventory can make all the difference if you need to prove that a tenant has mistreated your property, and can reinforce your argument to keep hold of the deposit if necessary.
An agent will do hundreds of viewings every month and will be well practiced at showing properties in their best light and selling the idea of living there to your potential tenants. “On viewings we ensure the tenant is called at least 30 to 45 minutes prior to the viewing and are advised who they will be meeting, where they are meeting and, more importantly, advised when the property is available and what is included,” says Major Mahil. “Viewings can be conducted at short notice too as the majority of keys are held in the office, which makes it easier to show the property to as many people as possible.”
9. Oversee property maintenance
If your tenant has a problem with the property, a management agency can often sort it out on your behalf – many can deal with emergencies too. “Good management of the property is one of the most important parts of lettings,” says Major Mahil. “Our service standards state that once a property management issue has been reported, our contractor is instructed within the hour. The contractor calls the tenant the same day and makes an appointment, plus our contractor follows up each call by either an email or a text message to the tenant and we are then updated ourselves so we can monitor the progress. We have an out-of-hours emergency helpline and our contractor can be reached after hours or on weekends too.” To prevent you being disturbed every time there is a minor problem, such as a leaky tap or faulty appliance, Lee Shuell advises, “Allow your agent to go ahead with jobs up to an agreed limit, £100 for example. Always ask for copies of the bill from the contractor and for any bigger jobs get a few quotes.”
If the worst happens and you have to start eviction proceedings against a tenant, many landlords find it reassuring to have an agent on their side.“If your property is with an agent on a fully-managed basis they should be able to help you with evictions and ensure that they are done legally and that the correct paperwork has been issued,” says Lee Shuell. “If you are managing the property on your own it may be advisable to instruct an agent to act on your behalf or seek legal advice beforehand if you are faced with an eviction situation.” Terry Lucking adds, “One of the main ways an agent can help is by attending court on your behalf. Many landlords also have other jobs and don’t have the ability to attend court, especially when timescales can alter at short notice. “Also, many people don’t know the proper process of serving documents. If you get to court and it’s found that documents haven’t been served correctly, are dated incorrectly or they include incorrect information it’s highly probable that the landlord will be asked to go back and start again. If an agent’s done it for you it’s more likely that they will have done it correctly and, if they haven’t, they are likely to have a professional indemnity insurance that you might want to make a claim against.”