A recent survey by Endsleigh Insurance has found that using a letting agent can save a landlord approximately £1910 per year.
The research reveals that it is a common misconception by landlords that letting agents do not offer value for money. Whilst not using an agent may result in ‘savings` of around £159 per month, when rental income and voids are taken into account it was found that agents actually saved landlords an average of £2000. Most of the savings were made through agents minimising void periods, compared to landlords who deal with the rental of their property themselves. The majority of those surveyed stated that costs were reduced as the agent found tenants quickly, and were able to help with legal and financial matters resulting in savings there.
The survey also found that it was important for landlords to have a good relationship with their letting agent, and this relationship was not just to do with finances. 50% of landlords use an agent because of their local knowledge, and 2 in 5 said that excellent service was a deciding factor.
41% of landlords stated that the main benefit of using an agent is peace of mind. In today’s climate of increasing legislation within the Private Rented Sector, unless you know what you are doing, consider using a letting agent. A good agent will be able to do more than just rent out your property for you, they will give you advice as to how to achieve the best rents, how to increase the capital value of your rental property, how to add to your portfolio, and how best to handle your growing portfolio in today’s market.
So what are the benefits of using a letting agent?
A local letting agent will be able to give a rental valuation based on their expertise of renting in that area. It is important you get this right in order to maximise the rent achieved whilst minimizing vacant periods. Letting agents have an incentive to negotiate the best rent for you.
Most letting agents will have accounts with the big name property portals, such as Zoopla, Citylets, Lettingweb, Prime Location, giving your property the best possible exposure to prospective tenants. They may also advertise locally, including ‘To Let’ boards. Remember letting agents have a vested interest in letting your property, as they are not getting paid as long as it is sitting empty. Letting agents should advertise your property before tenants leave, minimising vacant periods.
Letting agents will provide accompanied viewings at times to suit the viewer. This helps find the best tenant in the fastest time, again minimising voids.
Finding the Best Tenants
Getting the right tenant is essential, as you want someone who will pay their rent, and look after the property. Most letting agents will use a reference checking agency, and as long as the landlord agrees, will take up comprehensive references, including credit checking, to find you a good tenant. The Key Place has local staff who often know tenants in the area, and can therefore advise on who to accept, and who to avoid!
It is essential that you have a comprehensive inventory which fully evidences the state, condition and cleanliness of your property at the start and end of every tenancy. If you do not have this, it may not be possible to retain money from the deposit to cover any damage, cleaning etc. The Key Place use bespoke inventory software to provide detailed and accurate inventories embedded with photographs. We would urge all landlords to agree to an inventory being carried out at their property at the start of every tenancy. It is essential that you safeguard your investment, and we will do everything we can to help you.
The rental industry is becoming increasingly regulated to ensure properties meet acceptable standards. Landlords have a responsibility to ensure legal requirements are being met. There are large fines for non-compliance. Letting agents will be able to advise on all requirements. They will also have good trades contacts who can carry out necessary safety checks, including landlord gas safety certificates, electrical safety certificates, heat and smoke alarms, and legionella testing. New legislation is being introduced to this industry the whole time, and so it is essential you have somebody who is in the know keeping you updated, and dealing with this for you.
Letting agents will deal with all legal contracts (AT5, lease, tenant information pack) on your behalf. These must be completed correctly in order to protect your investment.
Rent and Deposit
The letting agent will collect the deposit and submit it to the tenancy deposit scheme for you. They will then deal with the deposit return at the end of the tenancy. They will collect the rent and make monthly rental payments to the landlord, with a statement of account. They will advise on rent increases throughout the tenancy.
Letting agents will deal with all repairs promptly on your behalf. As they can provide a regular stream of work, they have access to the best and most reliable tradesmen. It is important to keep good tenants, and good tenants do expect a reactive repairs service. Letting agents can also advise on repairs and a maintenance schedule to ensure that your property holds its value.
A letting agent will carry out regular inspections to make your property is being well maintained, and will take action if it is not. Protecting the value of your asset should be a key consideration, which is why receiving regular inspection reports are necessary.
Dealing with Tenancy Problems
Tenancies do not always run smoothly. Letting agents are experienced in dealing with all sorts of problems, from anti-social behaviour, to non-payment of rent. If needs be, they know the legal process for getting tenants out and will deal with this for you.
Ending the Tenancy
The letting agent will deal with everything at the end of a tenancy, from check out inspections to deposit returns. They will also source a new tenant for you as quickly as possible.
Letting agents provide a buffer zone between landlord and tenant. Landlords who manage their own properties can run into all sorts of problems if things go wrong with the tenants. You risk having them on the phone to you at 3am, demanding their toilet is fixed. By using a letting agent, the relationship is kept on a business footing, allowing you to relax, knowing your property is in safe hands. Reputable letting agents undoubtedly have experience with almost every issue you may encounter. They will be able to guide you through the vast amount of legislation that landlords must deal with, as well as dealing with the complexities of lettings, and offering solutions to practical issues. Not everyone is suited to being a landlord. Your rental property needs to be managed, and if you don’t have the time or the skill to do this, they you need to find a letting agent who does. Delegating the work to someone who knows what they are doing makes sense, in that it saves times and shifts the responsibility to someone you can trust to do a good job.
Choose a letting agent who is a member of a registered body, such as the Council of Letting Agents, and Landlord Accreditation Scotland. The Key Place is one of Scotland’s leading letting agencies, managing properties throughout Edinburgh as well as further afield throughout Midlothian, Edinburgh, East Lothian, Central Scotland and the Scottish Borders. Please contact me if you would like any advice on your rental property or if you are interested in becoming a landlord.