I recently read an article from a high street estate agent questioning why landlords would not change or review their current management agent. I fundamentally agreed with them on the main principle.
“We are all accustomed to regularly checking that we are getting the best deal with our fuel suppliers, investments, and insurance and if we find a better deal, we know it’s time to switch.”
“Being a landlord is not without risk, but a good agent can help to reduce the risks by finding great tenants, ensuring your property is well maintained, advising on rents and of course making sure that you receive money that is owed to you without delay each month. A good agent will also communicate with their landlords regularly, informing them of the results of property inspections, the resolution of maintenance issues and of course advise on upcoming changes to legislation, so that landlords can avoid the hefty fines that can be a consequence of non-compliance.”
Quote from Belvoir featured in landlord zone.
The article went on to explain how it was not about saving money and was about receiving good service, accountability etc. However, this is where we differ, margins are tight these days and Estate agents do not carry any risk; I believe the market is changing and I believe that there is an alternative solution.
I firmly believe that managing properties in the interest of landlords and is an essential service however online services have changed the market and there is little that you cannot source yourself. But if you did not want to or did not have the time to spend doing this you would look at a Letting agent to deal with all aspects for you, great! Or is it?
Agents will manage a level of vetting and contracts, both very important however…
You pay between 8-15% as standard for this service, which does not consider voids, maintenance etc. Margins for BTL investments are tight these days. Can you really make any money once you have paid an agent?
There is literally no incentive to pick the best tenant. Agents get paid to replace them, so in a way the more turnover the better. This leads to more costs for you and the potential of voids. If it were my hard-earned cash invested, I would want a tenant that would look after my property, which leads us too...
If this situation does arise Agents do not have to deal with the fallout, this is down to you. And whilst your property is either empty or you are waiting to go to court your agent is still getting paid.
Do agents really care how much it cost to fix the light switch? Do they shop around? Do they use tradesmen that do a good job? Sadly, my experience is no.
I expect to get my property back in the same condition and for this to be properly monitored during the tenancy. This just does not happen. So, when you get your property back will your 4/5-week deposit cover the costs of a full kitchen refurb? There is not much accountability once the horse has bolted. Where is the duty of care...?
You could obviously do it yourself and if you have a single unit, have plenty of time and are open to learning and putting in place some new processes and systems then it is not a bad route to go down.
But for the average small portfolio landlord or those with full-time jobs, that is a lot of work! Another full-time job.
The other approach is working with an agent that will guarantee your rent and take accountability and the risk out of the management process. We love serviced accommodation for several reasons.
We do not have the same issues as the traditional agent. We must keep the property in top condition otherwise it will not sell online. If we have a bad guest, we just ask them to leave. We actually put money into improving your property and if it's empty you still get paid!
We are your agent and tenant in one taking care of all aspects of your property. So, whilst we deliver the good service you want and should expect, we do all of this without fees and you receive the full market rent of your property, and that is why you shop around and try an alternative way to manage your property.
Landlord Consultants are the alternative way, have a conversation with us to see how we can take the risk, strain and worry off your plate and boost your income and free time, there is nothing to lose.
Whether you have a question about how it works or would like to book a visit.