7 reasons a landlord should use a letting agent
There are so many financial outlays when you become a landlord that forking out yet more money to employ the services of a letting agent may look like an inviting corner to cut. After all, how hard can it be to find tenants and collect rent from them?
The answer is, harder than many new landlords imagine. In reality, tenancy admin is often a big, time consuming headache – one letting agents are paid to take on. Not only can employing the services of a letting agent save you valuable time, they may even, in the long term, save you money.
From advertising the property, to checking references of prospective tenants, managing renter demands and keeping on top of maintenance, being a landlord can feel like a full time job, even if it’s just a sideline. Juggling all these landlord obligations alongside a busy job and family life could even lead to an expensive mistake, such failing to buy the correct licence or losing good tenants because you neglected repairs.
Here are some reasons to let a letting agent take on your rental property
1 Letting agents are pros
Letting and managing properties is, like any other, a job that requires specialist knowledge and expert know-how. Letting agents have the answers to tenant queries at their fingertips, understand the immeasurable red tape that binds the buy-to-let sector tightly and know the market inside out.
2 They know how much your rental property
Letting agents’ intimate knowledge of the market means you’re pretty much guaranteed to get the right rent for your property. Valuing your property incorrectly could cost you dearly – either in undervaluing – so shortening your yield – or overvaluing which could put off prospective clients potentially leaving you with financially draining void periods.
3 They know the law
The buy-to-let market is becoming increasingly regulated and as a result, there is a minefield of potential fines, and even prison sentences, for failing to comply with regulation that seems to change daily.
Letting agents will know whether you need a licence, what fees you can still charge (for lost door keys etc), they’ll know what your obligations are regarding safety certificates and their way around the particularly consensus Right to Rent policy.
4 They are masters of the tenancy agreement
Tenancy agreements are a legal contract between you and your tenant designed to protect both of you in the event of any disagreement. There are examples of tenancy agreements on the internet that in theory you could use, but they may contain out of date clauses or omit new regulations. Plus, there are no guarantees that this agreement will cover essential protective clauses that may be personal to you.
Agents can draw up a tenancy agreement with watertight clauses. A tenancy agreement must be compliant with the Tenant Fees Act 2019 and should not include any fees or penalties which are not specifically authorised by the act. These are all areas a letting agent will have first hand knowledge of.
Holding deposits are an important safety net for landlords should you need to cover damage or tenant rent arrears. But they are governed by strict compliance rules and you could be subjected to a large fine should you – even inadvertently – get this wrong. If your tenant is on an assured tenancy agreement – and unless they’re your lodger, they most likely are – a tenant’s deposit must be held in a government-backed tenancy deposit scheme. There are several available and your letting agent will be best placed to steer you towards the best one for your needs.
Every tenancy agreement must now be accompanied by a property inventory. This is a thorough and detailed record of the condition of your rental property and its fixtures and fittings. An accurate inventory helps to assess any damage or loss caused by an outgoing tenant that will be covered by their security deposit.
An inventory will be cross referenced against a check out report when a tenant leaves as evidence to support a claim. They remain a vitally important part of protecting your investment and a letting agent will be able to carry one out on your behalf or employ the services of a specialised inventory clerk they trust.
7 They know the right people
Maintenance can be the biggest headache for landlords. And it’s not just the cost of repairs and maintenance; finding a reputable tradesperson can be time consuming and stressful, especially if the issue – like a broken boiler – is having a detrimental impact on the tenant’s quality of life. A letting agent will have a contacts book of trustworthy tradespeople who can get the problem fixed as soon as possible – keeping your tenants happy and your rental income protected.