What should you look for in a letting agency?18/09/20
Should you choose to use a letting agent, rather than manage your property yourself, the next stage is to find one that suits your requirements.
There are several criteria that you’ll probably consider, but if you’ve never used one before you may wonder where to start.
The world of renting can be a minefield, which is why hiring a letting agent to guide you through is appealing to property owners.
One way to obtain peace of mind is to look for agents that are affiliated to a recognised governing body.
There are three of these:
Association of Residential Letting Agents (ARLA) arla.co.uk
This is a professional body concerned with the self-regulation of letting agents.
It was formed in 1981 and is involved in every aspect of residential lettings and management in the Private Rented Sector.
ARLA operates a robust code of practice which members are required to work within.
This covers the key stages in letting and managing a property and ensures compliance with issues like:
- Handling and accounting for clients’ money
- The mandatory ARLA Client Money Protection Scheme
- Professional Indemnity Insurance
- Dealing with complaints and disciplinary procedures
Letting agents affiliated to ARLA also have to employ a minimum of at least one member of staff in an office.
They must hold a suitable industry qualification, recognised by the Association.
A letting agent who is safeagent-licensed will:
- Accompany prospective tenants on viewings of properties
- Liaise with you if repairs or refurbishments are necessary to put the property into a fit state for letting
- Provide tenants with copies of safety certificates for gas and electrical appliances
- Advise on the rights and responsibilities of tenants and landlords
- Provide “a schedule” (details) of the condition of the property, plus an inventory of its contents
- Hold the deposit in a safe deposit scheme
- Provide help with sorting out accounts with utility providers and the Local Authority.
- Pass on requests for repairs and maintenance from tenants
- Give prior notice when the tenancy is coming to an end
- Return your deposit to the tenant as soon as possible, minus appropriate deductions (should there be any)
National Association of Estate Agents (NAEA) naea.co.uk
The National Association of Estate Agents is one of the UK’s leading professional bodies for all aspects of estate agency, including lettings.
It was founded in 1962.
By using a licensed NAEA agent you are guaranteed:
- Professional Indemnity Insurance, held by the agency which ensures you are financially covered for any members’ negligence, bad advice or mishandling of data
- To be served by a qualified and trained agent who can provide up-to-date advice and guidance with professionalism
All agents and staff undertake Continuous Professional Development (CPD) each year to upgrade their skills, and join the Association via formal qualification.
This ensures NAEA agents have the required knowledge and experience.
Members operate under strict rules of conduct, must meet agreed professional standards and practice ethically.
NAEA agents are required to protect and promote their client’s interests, whilst acting fairly with the public.
What do you want your letting agent to do for you?
Find you a tenant
The letting agent will market the property through the media and online.
They will show prospective tenants around, check references and draw up tenancy agreements. They could also collect the first month’s rent and deposit.
You can pay extra for an inventory and check-in on moving-in day.
Find a tenant and collect rent
They’ll offer the same services as tenant-find only, but they’ll also collect weekly or monthly payments.
Full management offers the same services as tenant find and rent collection but they’ll also manage the day-to-day running of the property on your behalf.
They’ll deal with everything from repairs and maintenance, to returning the tenant’s deposit once they’ve checked the inventory.
They’ll deal with tenants in arrears, and some also offer contract renewals and reassess rent prices based on market changes, renegotiating rent rates with existing tenants where needed.
With a full management letting service, make sure you’re clear what the agency has to run by you and what they’re expected to do.
For example, ‘full management’ can mean that they will carry out any emergency repairs without checking with you first.
Fees are one of the main considerations when employing a letting agent and these can vary.
If you want the full service, it will obviously cost more than the amount that will be asked for a tenant-find service.
Tenant-find only fees
These are charged as either a flat fee equal to around one month’s rent or as a percentage of the entire tenancy contract.
For example, if you’ve agreed to a six-month contract with your tenant then the letting agency would typically ask for around six to eight per cent of the period’s rent as their fee.
Tenant find and rent collection fees
Tenant find and rent collection fees will typically cost landlords around eight to 12 per cent of the monthly rent.
Full management fees
Full property management fees will typically cost landlords around 10 to 15 per cent of the monthly rent collected.
For longer tenancy contracts where you’re getting guaranteed rent for longer, it could be worth seeing if your lettings agent will come down on the price.
Lettings agents will normally operate on a ‘no let, no fee’ basis, just like the sale of a house.
The internet is a wonderful thing if you want to find out about a service, and comparing customer reviews can be invaluable when helping you to decide which letting agent to choose.
To find out more about how a letting agent can help you as a landlord, please get in touch with us today by visiting growproperty.co.uk