Well, will it benefit you to use a letting agent? The answer to that is entirely dependent on a few factors, so read on and let’s get you better informed for your final decision.
The major factor in most minds on whether you should use a letting agent will usually come down to the cost, and here I will give you an insight into whether it’s worth your time delving into it yourself, with a breakdown on whether the job is more effectively carried out by a landlord, or their overlooking agent.
If your time isn’t worth anything then yes it won’t necessarily benefit you, it’s definitely too expensive. What I mean by this, is that most landlords don’t rely on a rented property as their sole source of income and will be occupied with their own careers. So having to dedicate time to marketing your property, conducting viewings, ensuring compliance is upheld, overseeing a tenancy, and management of a property could actually be an unnecessary burden that may be benefitted by being taken over by an agent.
Getting the benefit of the right exposure first-hand is key, it’s the first step to initiating the pre-qualification of the potential tenants. Also having access to portals such as Zoopla, OnTheMarket, Boomin’, etc, and not just gumtree or a newspaper will then see you need to pay someone to do that leg work for you.
A letting agent will benefit from having a portfolio of managed properties, with the previous built experience they have, this proves invaluable as these are experiences in the craft that most day-to-day landlords won’t necessarily have. The continuous obligation of ensuring safety certificates are in date, that right to rent checks are re-done before expiry, as well as many others in regards to the HHSRS (the housing health and safety rating system) also ensuring the Housing Act 2004 is followed throughout the tenancy.
If you want to focus on true wealth creation, then repeat after me, ‘trading time for money doesn’t work.
Remember that line, and it’ll benefit you for life.
Many of the most successful people in the world have their assets working for them, rather than them working for their assets. Your time could be an invaluable benefit if it’s used in the most efficient way, so having the mindset that outsourcing the work of managing your property means you could potentially focus on another project to work on generating even more residual income!
As a whole, a letting agent with all its staff could hold 50+ years of experience combined in the field. For example, if a tenant falls into rent arrears and it needs chasing, there is a fine line between an acceptable level of contact and borderline harassment. I am sure the last thing you want is your tenant using allegations of harassment to keep you off their backs.
The same goes for an eviction, an eviction pack is vast and needs ensuring it is completed thoroughly, referencing it correctly to present to the judge overseeing the case’s circumstances. Are you confident that you gave all the documents in place if you then need to evict the tenant? To get an idea of why I reiterate this, have a look at the eviction form, do you have the time, patience, and expertise to complete it?
Minimized Rent Void Periods
Letting agents will benefit from a far greater reach than if you were to do it yourself. As mentioned before, having access to the likes of Zoopla, Rightmove, etc will increase engagement further, resulting in bigger exposure, in turn having a bigger choice of applicants to pick out for a better chance of the ‘perfect’ tenant.
Having your pick of a bigger group of applicants means more competition, this will help minimize void periods as you will have a better chance of making an informed decision on an applicant that you can delve into referencing and look to move in sooner rather than later.
Benefits Of Property Management Most People Overlook
It’s not an attractive thing to have to think about, it’s time-consuming, potentially costly, and with a busy lifestyle, isn’t ideal.
But inevitably your tenant will contact you with an issue that needs rectifying.
You can take all the precautions necessary, boiler and plumbing covers, and have electrical contractors and handymen on hand. However, the point is when the time comes, it is a frustration to even have to get these aspects arranged to start with.
Again, it comes down to the convenience and availability of time having to arrange it, when this is a benefit that can be arranged and overseen by a managing letting agent.
Chasing outstanding rents is a tricky area too, you will have to ensure you are not giving the tenants any excuse to shout ‘harassment’!
This could detriment your chances to have them evicted (if it comes to it), and the last thing you will want is a tenant assuming they can manipulate the situation. A letting agent will have the benefit of expertise to follow through with these requests, whilst maintaining a professional standard so that it comes to an amicable solution.
As I have previously discussed, the cost of a letting agent is the most popular reason why landlords are reluctant to use them and tend to overlook the benefits.
However, bear in mind that an agent can command a higher rent than a landlord advertising it themselves. Tenants will have greater trust in an agent, and it is a little more justifiable for them to pay the higher asking rents. So, a higher rent could help negate the costs of paying an agent monthly.
Yes, the lettings market is incredibly strong in the UK, you will receive lots of calls with inquiries on the property in question. Up to 100 calls depending on the type of property, think of the time spent speaking to all the applicants, around ten minutes each asking pre-qualification questions, as well as answering theirs…
Then co-ordinating viewings, attend those viewings and deal with the let-down of the 25% that either cancel last minute or that just do not turn up.
Time is money, and in this instance, you’ve lost yourself £200+ in lost time you won’t get back.
Beyond that, you’ve got the process of referencing, further questions, document collection, and compliance such as seeking their right to rent proofs. Again, this time equals money, and other things you could be doing to focus on your career or family life.
There will be associated costs with referencing and credit checks too, this will vary depending on the level of checks you want to be carried out, letting agents do this day in, day out, so will have access to the top-level services as a standard.
And finally, the ongoing management, has to liaise with a base of contractors to keep an ongoing relationship, ensuring all compliance is kept up with (EICR, EPC, Gas Safety, Routine inspections, smoke alarms, right to rent), and keeping the property in good structural and aesthetic standing is a big responsibility.
Again, with commitments to a career and personal life, this could be impactful on you. Under a management service, this is all overlooked, and undertaken where necessary, a huge benefit for you. The most you’d have to do to give the thumbs up for anything that relates to costs.
You’re right, it is.
Again, if you do property management full-time as a career it’s perfect, you’ll have plenty of disposable time to dedicate to your properties.
But most people use their property as an ‘additional’ income on the side and won’t appreciate this income-generating asset overtaking their day-to-day lives.
Focus on your career and personal or family life, leave this job to the dedicated specialists that have expertise in the field, and carry out these processes as part of their actual job.
Abbey Property is here to help if you are interested in having a chat about the further benefits of a letting agent taking over the management of your property. Contact us today!