20 years ago, renting out a property was a far simpler transaction than today. Finding a tenant was easy – a quick advert in the local shop window or a chance conversation in the pub and you had it sorted. There were no lengthy contracts, no strict laws and no deposit protection.
In the modern private rented sector (PRS), however, there has been a hefty introduction of stringent rules, regulations and restrictions imposed on a landlord, making the process a complex and often problematic one. But the benefits of an investment of this nature continue to make it a worthwhile venture, so what can take the pressure off?
For many landlords, the onus is on them to manage their property portfolio privately – resided to the fact that paying a professional property management company to handle their affairs is expensive and more hassle than it’s worth. But here’s the thing, it’s not. In fact, landlords are much more likely to struggle with finding suitable tenants, collecting rent and maintaining a property if they do take control and do it on their own, and find that it will end up costing them much more money in the long run. Here’s why:
1. Finding Tenants. Finding a tenant has to be a very careful and considered process, and an efficient one to ensure a property is not left vacant for too long and the landlord out of pocket. It’s imperative that the person or people signing up will help to maintain the property and a landlord’s investment throughout the tenancy, as well as pay their rent on time. Knowing where to find legitimate tenants and having the time to scour through and shortlist potential candidates is a mammoth task in itself, and one a landlord may not have the time or resources to carry out. Using a property management business will guarantee a quality tenant is chosen according to specific criteria set out initially by the landlord – and a dedicated residential lettings specialist will ensure the appropriate checks and references are carried out and that viewings, interviews, a tenancy agreement, and any other admin that needs to be done is taken care of professionally.
2. Maintenance. Any property is going to need some degree of maintenance over time, but a rental property has to meet certain requirements which means regular improvements and general upkeep will have to be carried out. This can often be one of the main reasons for a relationship between tenant and landlord to break down. As experts, a property management business will be able to provide impartial advice about home maintenance, carry out checks at the property and also have a book of trusted, local contacts who can help with any work.
3. Stress. Daily phone calls from disgruntled tenants isn’t going to do anyone any favours and could even lead to an agreement breach, or worse, missed payments and an empty property. A property management specialist can remove this element from the landlord entirely so that they are the first point of call for all tenants – making it a lot less stressful for a landlord.
4. Solitary. Not only are landlords alone in their decision making, generally tenants are more attracted to working with a lettings agent because having a third party involved offers them more security when entering into an agreement like this.
5. Paperwork. No-one enjoys paperwork, but when it comes to renting out a property, there is no avoiding it; from reference checks to proof of identity and deposit security, it all comes with plenty of admin.
6. Priorities. In many cases, a landlord will still have a ‘day job’ and their property might not be their first priority, so being able to manage it adequately, especially when there are urgent issues needing attention, is not always achievable.
7. Legislation. Having a team of regulated professionals on board will ensure that you are up to date with legislation. If you’re not, the consequences can be extreme and even simple mistakes can be very costly, for example a failure to obtain a gas safety certificate can result in a criminal offence or a £20,000 fine.
8. Growth. If a landlord hopes to grow a portfolio of properties then working with a property management business will be extremely beneficial to these plans. Being able to leave the management of existing properties in the hands of a property management business will take the pressure off and will give a landlord more time to find prospective new properties.
Ogilvy and Sneyd provide a bespoke residential property management and lettings service for property investors, buy to let investors and property landlords in Staffordshire and surrounding counties.