The pros and cons of letting agents
Tuesday, June 12 2018
Letting Agents, the pros and cons
Should I employ the services of a letting agent or not? Probably one of the first things any new landlord will consider and something which may even cross the mind of a seasoned landlord from time to time. Let’s face it; collecting rent, chasing outstanding payments or dealing with repairs at midnight are not top of any landlord’s wish lists. However, Letting Agents can take care of the dirty work for you.
Finding a suitable tenant for your property is not always as simple as it sounds. How do you know they will pay the rent? How do you check their credit history? Will they look after your property? What are the legal restrictions if you are faced with any issues?
All these benefits do not come without a cost and the value of the services provided by the agent to you is what must be assessed when deciding if you want to use an agent or not.
The Down Side
Obviously one of the first cons of using a Letting Agent is the cost. Using expert property professionals to support you when letting your property will cost you anywhere from 10% to 15% of your monthly rental income depending on what services they will cover for you. They will normally provide you with a list of the tasks they will cover when you sign up.
Also, not having face to face contact with your tenant can cause problems. Resolving issues can take longer as your agent will be acting as a middleman. If they don’t offer an out of hour’s service, some issues could be going on all night before you find out about them.
The Up Side
There are a vast number of plus points:
A local letting agent will have expert knowledge of the property market in your town or city. This means they are best positioned to value your property accurately, marketing it for you in the correct and aggressive manner that’s required to find a suitable tenant quickly. Some of these letting agents will even have fresh lists of potential tenants waiting for a property like yours.
No matter how in-depth your assessment of your tenant is, when acting alone it will never cover all the areas of the rigorous process an agent will follow. This process ensures you end up with a tenant who is as trustworthy as possible. They will also manage the entire process for you, removing all the stress.
Whilst relying on the middleman may be a negative, there are also several positive points to this. You are protected by the agent when having to deal with any disputes, meaning you will not have to deal face to face with your tenant. You also have the professionals on your side to provide advice and guidance on the process if things do start to go wrong. This means you should never find yourself on the wrong side of the law and ensure you follow all your responsibilities.
So now its decision time!
The main point for consideration is whether you are willing to pay 10%-15% of your monthly rent to an agent who will look after your property? Or, would you rather collect the additional payment and deal with these stressful processes yourself?
If you decide an agency is for you, make sure your agent is a member of ARLA – Association of Residential Letting Agents and/or is part of another professional body as well as The Property Ombudsman. This will ensure you have the protection you need.
Using an Agent is not essential, you may want to deal hands on. However, consider if you have time to deal with last minute issues or faults? You don’t want to find yourself on the wrong side of the law or in too deep with no support.
This article was put together by Peter Heron, who are professional letting agents in Sunderland, Tyne and Wear.