Getting more out of your rental property
Despite what some might describe as repeated attacks by the government on the landlord lifestyle, the number of landlords in the UK increased in 2013 -2014 by 7%, reaching 1.75 million (HMRC). And in 2014, two million private landlords owned and let some five million properties in the UK (Paragon). In short, the Private Rented Sector (PRS) is still a growing and successful sector.
The reason, of course, is that it still represents an exciting opportunity and a great way to earn a residual income. But contrary to popular belief (and as I know having been a landlord for some time), it’s not all about the money. So, what is important to landlords, what do you struggle with, and perhaps most importantly, as a letting agent, how can I help?
Maximising your yield
It may not be all about the money but it goes without saying, that profit will always be important. It’s not rocket science to suggest that in order to maximise your yield, you need to keep a keen eye on expenses and get the best possible rent for your property. And a good letting agent can help with both of those.
Letting agent fees
Letting agents often make big promises about what they can deliver but let’s start by taking a careful look at their fees.
It’s tempting to choose the agent with the cheapest headline tariff. But. And it’s a big but, make absolutely sure you know what extras will be charged on top of the basic fee or “Full Management” tariff. They can be deceptive.
Will you have to pay extra for:
- set up fees,
- inventory fees,
- fees to lodge deposits,
- estimates for repairs, and / or
- finding a tenant?
What happens if your tenant leaves in the first 12 months? Will you be charged again by your agent to find a new tenant or is that included in the upfront fee?
In other words, don’t be fooled by an attractive headline fee only to find that the final bill adds up to a great deal more than those agents who you thought were more expensive!
What’s the best rentable value?
Whether or not you know the area in which you’re hoping to buy (or let), the insider knowledge of your letting agent can be invaluable.
Your agent should know the state of the rental market – has a significant employer in the area relocated elsewhere? Is it a popular area for students or young workers making it suitable for multiple occupancy? Are there plans for improved infrastructure that could make this a desirable commuter area? Has a planning application been submitted for a development which may make this a very unpopular place to live?
Don’t just rely on your own knowledge or research of similar rental properties in the area. Instead take advantage of your agent’s knowledge and experience to make sure you buy a property with the best possible rental value.
Ensuring you get the best tenants
As a landlord, you want to avoid two things – long periods of time when your property is empty and unreliable tenants who leave the property in a mess or don’t pay their rent.
That means, the quality of your tenant vetting process is vital. Check at the outset what your chosen agent’s vetting process is and that it’s robust. If it isn’t (or they haven’t really got one), walk away. You’ll end up with the first person who turns up and that’s rarely a good thing.
All agents should credit check the tenant and the guarantor, as well as asking for references. And all references should always be checked out thoroughly.
Then ask your agent whether they visit prospective tenants in their current accommodation. Because that can be a very good indicator of how they may treat your property.
An easy life
As I said, being a successful landlord isn’t all about maximising profits. Most landlords I know genuinely care about their tenants and want to be sure that they are living as comfortably as possible. But that doesn’t mean they want to spend every second minute following up tenant complaints, checking properties and making sure they’re compliant.
In short, most landlords want peace of mind and the knowledge that their tenants are happy and their properties and tenancies are legally compliant.
And that’s where a good letting agent can add real value. For example, at EweMove, we’ll manage all statutory compliance aspects of letting your home, from your Energy Performance Rating to your tenancy agreement and your inventory.
We’ll also make sure that we’re there when you or your tenants need us. We’ll keep you updated if there is a problem and we can recommend trusted suppliers.
In fact, we recommend that it’s a good idea to agree in advance what sort of issues you always want to be involved in and what issues you’re happy for us to resolve without bothering you. Although of course, we’ll always keep you informed – you just may not want a call from us at midnight on a Saturday night!
What’s important to you?
I’d love to know what you value most from your letting agent and what’s important to you. Please feel free to leave a comment or get in touch.
Graham Faulkner is Branch Director of EweMove Dorking
He’s bought and sold a lot of properties over the years and is also a portfolio landlord, as well as specialising in helping other landlords. Apart from his own experience and expertise, he can also recommend the right professionals, as tried and tested by him, to advise you.
Multi award winning EweMove in Dorking is a residential property sales and lettings agency who pride themselves on being refreshingly different and standing out from the crowd. EweMove Dorking covers from Ockley to Oxshott.
Enquiries to 01306 406 506 / 01372 701 702, or via email to firstname.lastname@example.org