The Daily Telegraph - Saturday - Money
‘Letting agencies can be shark-infested waters’
I call the agent as a renter and ask myself: Is this how I want my tenants to be spoken to?
You usually hear of tenants being taken for a ride by rogue landlords, but there are other threats that lurk within the rental sector.
The first time I hired a letting agent for one of my properties was 18 years ago. He seemed a decent enough chap and had an office on the high street. But within six months he had stolen two months’ rent and was nowhere to be found.
The business of letting agencies can be shark-infested waters. The industry remains unregulated and you need no professional qualifications to set up shop.
Even I, a cynical landlord, find it ludicrous that these agents don’t even have to pass a competency test. The Government came up with hundreds of bits of legislation that a landlord needs to follow to rent out a house, but all an agent has to do is belong to a property-redress scheme and abide by consumer law.
That means if, as a landlord, you want to employ a letting agent, the onus is on you.
And maybe you’re thinking, I don’t need an agent, I’ll do it myself. That’s fine, if you have the time, patience and knowledge, and live close by. But unless you can cater for your tenant’s every whim, I’d get an agent.
For all my snarky remarks, a decent letting agent is a godsend. So, how do you find a good one? Here are my tips.
First, check that they’re a member of a property-redress scheme (the one legal thing they have to do), and see if they’re a member of any trade associations (like the Association of Residential Letting Agents). I do an internet search and read every review. I make a note of any names that come up frequently and highlight any negative points.
Then I call the agency. I tell them I am a landlord looking for an agent and ask them a series of questions: what percentage of their portfolio is currently in arrears, and what is their average void time? What are the timings for listing a property, how long does referencing take, how do they judge a prospective tenant and how long does it take to move them in? I want to know how they source and contact contractors in the event of an issue, and how tenants report maintenance requests.
I ask about kickbacks (commission received for works), if I can be billed directly for invoices, how many staff work on the maintenance team and how long staff have worked in their roles. I ask when I will get copies of the assured shorthold- tenancy contract, deposit paperwork, inventories, and gas and electrical certificates. This point may seem moot, but you’d be surprised how many agencies don’t automatically send the information.
Now, as a landlord, you must place your tenants’ deposit in a protection scheme. I make sure to cover my back, and always ask for the certificate from the agent, to be sure it is protected. I am the most mistrusting customer any letting agency could have.
It is likely at this stage in the conversation the agent will feel bombarded. I do this on purpose, as I like to test people. In the landlord/ letting-agency relationship there will be challenging times. There will be many conversations you won’t want to have, and stress that you’ll have to deal with, so it’s best that you like the person you’ll be liaising with.
Every time they talk, I judge them. Are they in this business for themselves (and their fees) or for looking after my property? There is a huge difference between those who care to do a decent job and those who care to earn a decent fee. If this relationship goes well, it could last many years, so I listen out for small things, the details.
If they pass all these tests, I move on to the next stage. I call back and pretend to be a tenant inquiring about a listed property, and then see how they treat me. I ask myself this question: Is this how I want my tenants to be spoken to? Are they helpful? Courteous? Do they sound like they’re smiling down the phone? Are they hungry for business?
My agency selection may sound onerous, it’s intended to be. Property management is a serious job. Only those who really understand that ever get my business.