Helpful advice from Bishop Sullivan – Residential Property Letting Agent and Property Management Agent in Brighton, Hove, Kemptown & surrounding areas.
First time letting? Here are some residential property letting tips and guidelines for those who want to let their properties but don’t really know where to start…
It is not a legal requirement for an Agent to be regulated by the Association of Residential Letting Agents (ARLA), those that choose to be regulated by the industry’s largest body send out a very good message. Members are also required to have Client Money Protection.
It is a legal requirement for an Agent to be a member of one of the three financial redress schemes – The Property Ombudsman, Property Redress Scheme & Ombudsman Services.
2. Know the market
Before investing speak to Bishop Sullivan to determine what type of property you should be looking for and, once found, who it would best suit. For example, families have different requirements to sharers.
3. Hidden terms & VAT
If agreeing terms with an agent it is essential to read the Terms of Business front to back to be sure there are no hidden terms. A common practice is where an agent charges a contractor 10% of the invoice total meaning all external invoices are 10% more expensive, on top of your management fee! It is illegal to carry out this practice if it is not in the ToBs.
Another to watch out for is the agent not including VAT, despite it being a legal requirement. All Bishop Sullivan administration fees include VAT and commission shows both. Our 7% + VAT Managed fee is 8.4% inc VAT for example.
The more attractive the property the better the quality of Tenant, rent and often Tenancy term it attracts. If possible light dressing such as curtains, blinds and light shades can help.
The property needs to be left in a condition the Landlord would wish it to be returned in, fair wear and tear excepted. This will be noted on the inventory and referred to when the Tenants vacate.
An impartial and professional inventory is by far the safest option as any findings cannot be classed as ‘biased’ unlike an agent or Landlord preparing the inventory.
Bishop Sullivan provide all Tenants with a copy of the ECP, gas and/or electrical safety certificate (if relevant), deposit registration certificate and Tenancy Agreement. As a Landlord it is always a good idea to leave a folder with any operating manuals (especially for the heating system), property guidelines and timetables such as bin collection.
8. The worst
Apply a ‘worst case scenario’ to the property and check you have the necessary contacts to resolve problems should they arise. For example a roof leak in winter – do you know a contractor who can repair this at short notice?
It is also recommended to have a savings account specifically for your property so if/when something goes wrong you are in funds to remedy it. Delays can result in increased damage and frayed relations with the Tenant.
Even with the best agent you can still suffer a void period for reasons such as changing market conditions or refurbishment being required so it is also advisable to include this as a potential use of the property savings account.
Having good lines of communication between Landlord and Tenant or Agent and Tenant are essential for dealing with issues if and when they occur. It will also encourage longer Tenancies if Tenants feel like they are being looked after properly.
10. Tenancy trouble-shooting
Where maintenance issues occur starting a dialogue early with your Tenant can help prevent anything escalating. Keep in mind that accidents can happen whoever you are.
Being consistently firm but fair is the best way forward when resolving issues.
Bishop Sullivan will set up a standing order for all Tenancies however these can be altered or cancelled by the Tenant at any time. It is made clear to Tenants that rent must be received in the relevant account on or before the rent due date as per the Tenancy Agreement and this should not change during the Tenancy.
12. Be realistic
Although the market has been in rude health for some time things can change and rents can go down as well as up. The most important thing to ensure the rent keeps coming in is occupancy. Bear in mind if your property let for £x last year it does not necessarily mean it will be the same this year.
Bishop Sullivan will advise on the current market value if and when your property becomes available and will be happy to provide comparables if this is required.
Banking errors are the most common reason for rent being late. Rent is ‘late’ if it does no arrive on the Rent Due Date as per the Tenancy Agreement so it is important to contact the Tenant the first day you are sure rent has not arrived.
It is better to assume there is a mistake rather than rent is purposefully late. Where it is the latter you must remain in regular contact with the Tenant until the matter is resolved, setting deadlines along the way.
14. Visiting hours
It is essential that a property is checked regularly to ensure it is being looked after in a Tenant like manner and also to spot current or potential maintenance issues before they worsen.
Once every three months is the generally accepted maximum permitted while ensuring the Tenant has ‘quiet enjoyment’ of the property.
Always ensure you have given the Tenant 24 hours ‘written’ (letter or email) notice before entering. If you are travelling a distance it is advisable to call the day before just to check the notice was received.
Where the property in question is or was you or a family member’s home there can be an emotional attachment. Investment in property should be treated as a business so being too picky on who rents the property can have an effect on any void period and/or the level of rent agreed.
Landlords should look at Tenants as customers hiring a product and treat them as you would wish to be treated. It is good business sense to bear in mind that it costs far less the retain good customers than it does to create new ones!
Rent should be increased annually to ensure it keeps pace with the economy. If inflation goes up by 2% then your rent has gone down by 2%. Multiply that by a few years and it will really start to eat into your margin.
If you do not increase your rent for a reason such as a great Tenant or a long term maintenance issue it is important you inform the Tenant so as it will built goodwill and loyalty and is likely to encourage a longer stay.
Don’t forget your insuring obligations for a house and it is suggested you take out insurance for your contents as, for example, carpets are not covered in if damaged in a leak.
Bishop Sullivan also offer a Rent& Legal warranty if you wish to insure your Tenancy against potential Tenant redundancy or illness causing rent arrears and/or refusal to vacate.
18. Long-term relationships
“Don’t take long-term tenants for granted,” warns Rosemary Millican of Belvoir Macclesfield. “When you visit, consider if furnishings/decor need updating. Are these things which would be done if the tenants moved out? If so, you may retain that tenant for much longer by doing them now.”
You should plan to put aside enough funds to decorate one room per year. Bearing in mind the hallway, kitchen and living room tend to see the most amount of wear.
If you keep an eye on this and carry out work where required to keep the property looking its best you will retain your Tenants for longer and ensure the property looks its best when remarketed.
Whether you are using Bishop Sullivan to liaise between Tenant and Landlord or carrying out negotiations yourself it is important to note that deductions can only be made with both parties agreement so any cleaning, decoration, removal of items etc… will have to be carried out at the Landlord’s cost until an agreement has been formalised.
Damage deductions can be made for anything classed as above ‘fair wear and tear’.
Sometimes it is better to agree a lower amount than dig your heels in for an extra £20.00 when you may have to go through the dispute service to get it, which can take up to three months.
Customer and New Tenant
I highly recommend the services of Bishop Sullivan. The advice they provided for landlords was fantastic and really helped smooth the process of letting my property. I could not be more happy with my choice to use Bishop Sullivan.