Questions for Letting Agents
When assessing a new location for purchasing an investment property talk to three or four independent local property managers or letting agents who specialise in letting. It can often be all to easy to forget to ask vital questions, we have provided some suggestions below;
Suggested Questions
- Do you specialise purely in lettings only?
- What properties are in most demand in the area and why?
- Is property more rentable furnished or unfurnished?
- What are the type of potential tenants? (students, etc..)
- What is the rental scale in the area?
- Anticipated turnaround from marketed to rented?
- How long has this business been established?
- How many properties are you currently managing?
Additional if you would like them to manage your property, ask them to provide emailed or written details of the costs and negotiate costs wherever possible if you plan to have several units in a particular local area.
University lettings
Talk to Student Letting Officers – build rapport so they promote your property above others. They too can give you good advice on demand, i.e. where, how much etc.
Preparing to Let
Don’t get personal when it comes to decor. Stick to neutral colours that will go with anything. For example, a red sofa might not match a green carpet. However, all colours look good on beige. Stick to a common theme on all your properties that is proven to work, e.g. magnolia walls, white ceiling, white six panel doors etc.
Carpets: Light beige looks great when clean. Light colours make rooms look lighter, brighter and bigger. They also encourage cleanliness and are easy to justify cleaning when a tenant vacates. Look for felt backed bleach cleanable carpets which cost around £5.99 per metre and often do not require underlay. Replace carpets every 3-5 years and get carpets cleaned every time a tenant moves out. If necessary you could consider recovering the cost from the tenant’s damage deposit.
If Letting Yourself
Join your local Landlords Association. This is the easiest way to keep up with legislation and to obtain advice on getting your paperwork right (tenancy agreements and notices etc.) Other landlords in your area will be keen to share good and bad experiences. Learn from their experiences rather than making your own costly mistakes.
Documentation
Obtain full details including names, addresses and contact numbers of referees and emergency contacts. Also obtain previous addresses, NI numbers, employer details and proof of earnings from prospective tenants. This makes life easier if you ever need to track down an absconding tenant.
If possible fill in an application form at the prospective tenant’s home in order to see how they look after it.
Fees
It is normal practice to charge a fee to tenants of around £100 for completion of tenancy agreements, referencing, inventory etc.
Deposits
The laws regarding tenant deposits changed on 6th April 2007. The scheme was set up to allow tenants unbiased access to get all or part of their deposit back when they are entitled to it from overzealous landlords. This now makes disputes easier to resolve and encourage tenants and landlords to make a clear agreement from the start on the condition of the property
There are two types of tenancy deposit protection schemes available for landlords and letting agents. All schemes provide a free dispute resolution service. It has been common place to request 5 – 7 weeks rental plus one month’s rent in advance. From experience tenants will often cancel standing orders on the month prior to the final payment – if this happens you will still have some money to cover damages.
Further details of tenancy deposits and schemes can be found by visiting www.direct.gov.uk
Check in/out
Prepare an inventory – include everything stating the colour, condition of walls, ceilings, doors, fixtures & fittings etc, and get it signed so you can prove damages when the tenant vacates. The more detail, the better. Even include the colour of light switches and door handles and what they are made of. Comments like “carpets have just been professionally cleaned” or “walls are freshly painted” will also help to prevent disputes on checkout.
Ensure that you arrange a checkout inspection and make certain the tenant is present – get them to sign confirming any damages and/or required repairs.
Complete utility checks and ensure the incoming/vacating tenant signs to confirm meter readings.
Inform the utilities companies and local authorities in writing of incoming/outgoing tenants and any applicable meter readings.
Look after your tenants
Happy tenants will respect your property and will refer other potential tenants to you.
Remember, it’s the little things that make a big difference – birthday cards, fast response to problems, etc.
Finally...
If the above is not cost effective or convenient for you, then you should seriously consider employing the services of a property manager.