Debunking common misconceptions about letting agents.
Property investment and portfolio management is a complex process, filled with legislation and regulation and fraught with potential problems. This article intends to debunk those myths so you can feel confident in the fabulous professional service your chosen letting agent will provide to look after your property portfolio.
Property investment and portfolio management is a complex process, filled with legislation and regulation and fraught with potential problems. Because it is such a complicated process, many myths are widely believed by the general public. This article intends to debunk those myths so you can feel confident in the fabulous professional service your chosen letting agent will provide to look after your property portfolio.
You don't need a letting agent - FALSE.
Ok, you technically don't NEED a letting agent, but employing professionals to manage your rental property is the smart thing to do. Many examples show that your experience as a landlord will be more pleasant, lucrative and less stressful if you employ a professional agent to assist you.
You can only get the rent that the agent is quoting - FALSE.
Your letting agent works for you, so if the agent quotes a rent value and you believe it is inaccurate, you can request that the agent try to market the property for your own price. Of course, evidence will be available to back up the agents' quoted value, so you must be practical here. If the evidence-based valuation is £800 per calendar month, attempting to market the property for £1200 per calendar month would not be sensible. But, if you've had other opinions from agents at a slightly higher price, say £850 per calendar month, you can, of course, request that the agent begins marketing at a slightly higher figure.
You have to go with the tenant that the agent finds you - FALSE.
If the agent receives an application from a tenant you don't think will be a good fit for the property, you can decline that tenant. There are anti-discrimination laws, so you must follow these rules. However, if you have a justified reason to reject an application from a tenant, despite a recommendation by the letting agent, this is ultimately your decision. This is often the case if a tenant doesn't quite meet the requirements of a letting agent's reference, but the landlord can overrule the agent's decision and accept them anyway.
The agent will charge the tenant loads of fees - FALSE.
Formerly, letting agents would charge a tenant a referencing fee to cover the costs of the tenancy references, but this has not been possible for some time now. In fact, since The Tenant Fees Act 2019, letting agents cannot charge the tenant ANY upfront fees for any reason.
The agent gets to keep the deposit - FALSE.
The deposit paid by the tenant at the outset of a tenancy will always be considered the tenant's money. It is a legal requirement to hold these funds either with an insurance policy or in a custodial service such as the Deposit Protection Service. The agent does not have access to this money for their own use. And, if damages are caused to a property when the tenants move out, it is not as simple as the agent withdrawing the amount needed from that account. There must be evidence that the tenant caused the damage, including repair quotes.
All letting agencies are the same - FALSE.
All letting agencies are absolutely NOT the same. Although the laws and regulations an agent must abide by are the same across the board (with some variations between England, Scotland and Wales), there are nuances in every agent's working practices and marketing methods. You must trust your letting agent; you will be working together for months, possibly years, and you will allow this agent access to your property rental income and hand over the responsibility of your property and tenant to this agent. Research the agency and get to know them - it is more than just comparing the fees between agencies.
Once you've used a letting agent, you can't change until the tenancy ends - FALSE.
Of course, you will sign a term of engagement contract when you initiate the relationship with a letting agent, and there will be clauses about the ending of that relationship. There will most likely be a notice period, and the agent will be able to collect your files and transfer them all to your new agent, including a transfer of the deposit funds. If you cancel your arrangement with an agent, you do not have to wait until the tenancy ends, and your tenant should not have to vacate the property because of your desire to end the management arrangement. You should let your tenant know about the change so that they are aware and can change their rental payments to the new agent, but they shouldn't have any negative impact. And you, as the landlord, should not be beholden to a letting agent that you are unhappy with purely because you don't want to evict your tenant.
If you are considering renting out a property, or perhaps you are unhappy with your current agent and would like to transfer the management of your rental property, contact our team of property experts to help.