Ask a Letting Agent anything

[Louis Balfour]

superlightr said:

we generally allow pets and are able to get the LL consent to pets right away - so its not been an issue.

Reptiles are though as we have had no end of issue with them/those owners which is tarring with one brush so will refuse reptiles most times - sorry Lizardbrain.

It’s more the owners of reptiles than the reptiles themselves right?

[superlightr]

Louis Balfour said:

superlightr said:

we generally allow pets and are able to get the LL consent to pets right away - so its not been an issue.

Reptiles are though as we have had no end of issue with them/those owners which is tarring with one brush so will refuse reptiles most times - sorry Lizardbrain.

It’s more the owners of reptiles than the reptiles themselves right?

Yes. We could be persuaded but it would have to be exceptional.

[lizardbrain]

They'll be giving cheaper car insurance to women next.

[Gladers01]

lizardbrain said:

They'll be giving cheaper car insurance to women next.

How many properties did you have on the books and how much would be the typical fee for the monthly percentages, and did you do a tenant introductory fee only and allow the landlord to manage the maintenance aspect ?

[croyde]

I got my latest place as a single man over a family.

The family were even offering above the rent asked for whilst I stuck to below the amount.

But I did get one place by having to pay 11 months upfront as the LL was worried about me being freelance.

Gotta move yet again in a year and am dreading it. It's not fun at all..

It was great years ago when it was affordable and there were plenty of nice interesting properties.

Tempted to see if I can do a deal for a hotel room.

[LFB531]

Admire your up front answers to some of the questions OP!

I'm in a similar position to you (were!), in the same industry and sounds like an almost identical business profile. I'm approached most weeks to sell up and do give it some thought. Inevitably the big buyers are the corporate mob (we're probably a bit large for a privateer to take on), if you went that way did you find their due diligence process ok?

Would fully understand if you had no comment!

[NextSlidePlease]

superlightr said:

NextSlidePlease said:

Is rightmove the only realistic way of letting? I am in the process of setting up as a letting agent (following a decade plus of being a landlord) but my god the fees!. Can you get by at least initially on various social medias and own website and tenant shortlists rather thave having to hand over 4 figures a month to RM?

We are getting out now at the top/peek of the market for letting agents - its going to go downhill quickly for smaller agents as the big boys are buying up and the hoops to jump through are getting ever more for the letting agent. I think it will be ok for the landlord but at the end of the day we know we will struggle in a few years to compete with the larger firms, our income will decline and our sale vale will drop. It wont be viable from our pov. bear in mind this is our pension. So we took the decision to cash in now before the really serious changes impact smaller agents and landlords and before our value declines.

If you are starting organically ie you are not buying up a portfolio or another agency then good luck. its very hard to break in to make money now. the costs are very high at all levels, the competitors will be fierce, they will have better tech. Yes you can undercut, yes you can be more nimble and offer a more personal care for your landlords but to actually grow it and make money you then get into the stage of you will need staff and then thats where the issues start. You also have to know what you are doing in so many technical areas. Training and compliance for yourself and staff are vital. Its so easy to screw up the paperwork. Most DIY landlords dont know half of what they have to do and end up screwing up. It may not come to light and they think they are good at it but when they get bitten they get bitten hard with multi thousand pound fines. Get ARLA trained to level 4 which you will need to be shortly by law as an owner of a LA. (I think its level 4 or perhaps 3) This will help you to understand the issues.

Wife and I did well on compliance as we both have law degrees and worked as solicitors - compliance is where the hard work is - letting properties is easy. Proving compliance is also a major part now if and when you get inspected or challenged by trading standards. Proof, compliance and vigoursly following procedures.

Where you can beat the big boys and where we did is on the tenant selection and not having issues with tenants from the very get go. We were very selective.

Bear in mind;
the govt hate you, the public hate you, the banks hate you, the governing bodies hate you and trading standards hate you. You are public enemy number one. Before you go any further check out that you can actually open a client bank account. many banks will not do so for new business.

I honestly would struggle to recommend you going into at this time without full training and having worked in the industry for years. looking after 4 properties is nothing like running a letting business.

Appreciate the reply. I already look after 20 odd properties of my own and friends but I am twiddling my thumb's half the week so that's why I was going to pursue a lettings agency. My tenant shortlist is touching 30 already so will look to expand that as much as possible and match tenants with properties that way. I know the industry inside out and I am accredited with NRLA so it's not jumping into the unknown. ARLA training will be sought too.



As for tech I come from an IT background so have got website and tenant portal stuff sorted, with as much automation as possible to reduce the need to call us. That and not having a branch network will help keep overheads low. Going into it with a good friend who operates a maintenance firm. Start up costs are going to be quite low so not too much risk involved.

Oh and my brother is a gas engineer and my sister a solicitor so got a lot of bases covered there too.

As for the hate, yep, it's not pleasant when governments of all colours use landlords as a political football, and the media portray you as scum of the earth but at some point they are going to have to work with us because it's a big old beast is the PRS and pushing out landlords doesn't help the renters in any shape or form. If they really want to stick it to landlords they should be building a million + homes a year to stifle demand.

Edited by NextSlidePlease on Friday 17th March 16:29

[nikaiyo2]

Quhet said:

Why is an annual rent raise best for the tenant?

I let out a flat and have just had some tenants move out. Am being quoted ridiculous rents that I could now charge apparently. Whilst I obviously want to make some money, I'm not a so will keep my rent a bit lower as i think this is fair. I'm not going to be charging someone £1,400pm for a 2 bed in Bristol, that's madness and a third more than my mortgage for a 3 bed house. I feel really uncomfortable about the constant squeezing people of everything that they can give and it just doesn't feel right.

Not wanting to de-rail the OPs thread, but IMHO pricing under the market rate attracts the wrong type of tenant. I would never want a property advertised under what it looks like it should rent for.
Its one thing taking a lower rent because a prospective tenant is employed by the council/NHS/ MOD and wants to stay long term.

[Louis Balfour]

LFB531 said:

Admire your up front answers to some of the questions OP!

I'm in a similar position to you (were!), in the same industry and sounds like an almost identical business profile. I'm approached most weeks to sell up and do give it some thought. Inevitably the big buyers are the corporate mob (we're probably a bit large for a privateer to take on), if you went that way did you find their due diligence process ok?

Would fully understand if you had no comment!

We owned a letting agency back in the early noughties. It was a different job back then. We diversified away from lettings outside our own book fifteen or so years ago - would not want to be involved with it now under any circumstances.

I think the OP did well to sell up and can understand why you would, if you got the right offer. It’s not going to become any easier.

[Mojooo]

I am currently renting in a HMO direct with the LL - but if I wanted out and found someone to replace me and I was willing to cover some of the admin costs -is there any reason they should have an issue?

[bristolracer]

Do you know Stath?

[33q]

How are your clients dealing with the revised EPC obligations.

Many must be finding the costs to improve the rating to be beyond a reasonable rate of return.

[NextSlidePlease]

33q said:

How are your clients dealing with the revised EPC obligations.

Many must be finding the costs to improve the rating to be beyond a reasonable rate of return.

This was supposed to come in by 2025, not a chance in hell are they are going to make that, and the information is very vague so i think most landlords will hold fire until firm dates and obligations are nailed down.

i am eagerly awaiting this as i have two victorian stone built properties that will not reach C without serious cost, and thats before the rules for being in a conservation area clash with the gov rules. I have done what i can already with them, and they are at a D, but will need internal wall insulation to get any higher, and would rather sell them than go through all that faff.

Add to that i think there is changes in EPC ratings incoming, focusing more on carbon footprint rather than cost to heat, which means some properties that reach a C after all that cost could then be downgraded again leaving the landlord facing down another potential huge cost to try and achieve C again.

in short, that government policy is a st show.

[LooneyTunes]

NextSlidePlease said:

33q said:

How are your clients dealing with the revised EPC obligations.

Many must be finding the costs to improve the rating to be beyond a reasonable rate of return.

This was supposed to come in by 2025, not a chance in hell are they are going to make that, and the information is very vague so i think most landlords will hold fire until firm dates and obligations are nailed down.

i am eagerly awaiting this as i have two victorian stone built properties that will not reach C without serious cost, and thats before the rules for being in a conservation area clash with the gov rules. I have done what i can already with them, and they are at a D, but will need internal wall insulation to get any higher, and would rather sell them than go through all that faff.

Add to that i think there is changes in EPC ratings incoming, focusing more on carbon footprint rather than cost to heat, which means some properties that reach a C after all that cost could then be downgraded again leaving the landlord facing down another potential huge cost to try and achieve C again.

in short, that government policy is a st show.

You’d be surprised how often this crops up on here with lots of people seemingly getting mixed up between the residential consultation (no changes were ever actually confirmed) and the change in min EPC for commercial. If there is a change in min resi standards, I’m expecting the exemption regime to continue.

[jmn]

It will be interested to see what the forthcoming Rent Reform Act has to say.

I have also seen reference to a new Decent Homes Standard that would for example prevent a new Tenancy where the Kitchen is more than 20 years old.

[croyde]

I'm sure the efficiency letter or whatever it's called can be faked.

My current rented flat is down as a C, but it can't be.

No insulation, boiler on for hours to get to just 18c in the lounge. Drops back to 11c within a couple of hours of being turned off.

No ventilation apart from opening windows in the bathroom and kitchen, which I do despite the cold, but still black mould everywhere.

Which I constantly clean up.

C! no way

[djc206]

superlightr said:

We found that if a landlord does not increase the rent for a few years then it gets so out of touch with market rent when they do have to increase it the tenant then cannot afford it or feels aggrieved. Equally if a tenant is suddenly presented with a large increase pcm its such a shock and creates bad feelings.
We all want tenants to be happy and to stay long term the rents on renewals are pegged below market rent at each renewal and we explain this to the tenant and LL so both sides get a fair deal. If empty then yes it will be at max market rent and then let and then renewal pegged below and so on. It works much better that way for all.

There is some sound logic in there as someone who has never been a LL but has rented a number of properties in the past. Although I will say each time a landlord has proposed a rent increase to me/housemates we’ve just emailed back giving notice and they’ve backed down to avoid the costs of getting a new tenant in. Things would have been quite different in the recent market I’m sure.

On the topic of pets we did struggle to find a property when we wanted to get a dog. In the end we found that offering an enhanced deposit and a landlady who only had the one property and would take the time to meet us personally secured a lovely house. We made sure to leave that house in the best condition we possibly could in the hope that the landlady would rent to pet owners again.

[NCE 61]

If tenants get in arrears with the rent what steps would you take as the letting agent?

[austinsmirk]

I can make this thread even more interesting: I let around 2500 social housing properties a year.

See the council thread.

Until you’ve been there: you cannot comprehend how society truly lives.

[Gladers01]

croyde said:

I got my latest place as a single man over a family.

The family were even offering above the rent asked for whilst I stuck to below the amount.

But I did get one place by having to pay 11 months upfront as the LL was worried about me being freelance.

Gotta move yet again in a year and am dreading it. It's not fun at all..

It was great years ago when it was affordable and there were plenty of nice interesting properties.

Tempted to see if I can do a deal for a hotel room.

That's a huge deposit to pay, when I used to rent out a property as a LL the deposit was one months rent plus one month in advance, the letting agent would take 15% of the monthly rent for a full management service or a one off introductory fee and no monthly commission, the vetting process was key, 9 times out of 10 the tenants were good as gold but the law of averages often meant 1 in 10 would be troublesome.

A friend of mine sold a £550k cottage a few years ago (mortgage free) and moved into a hotel on a temporary basis, he's still there and pays about £800 per month and seems to enjoy the lifestyle