If you are thinking about renting out your home or a second property, it can be overwhelming knowing where to start. Letting a property can seem like an easy way to make a bit of money, but there is often a lot more to it than people first think.
The process of letting out a property is complex and time-consuming but having a letting agent can help you to manage and market your property successfully. Whether you are a newbie to the buy to let world or a professional landlord with an impressive property portfolio, having the help of a letting agent can save you a considerable amount of hassle and time.
The guide explains everything you need to know about what a letting agent does and how they can help you let your property successfully.
What Is A Letting Agent?
A letting agent is a company that will manage all aspects of renting out your property on your behalf. They will help you to determine the rental income for your property, advertise the home online, find suitable tenants and provide all the legal documentation for the rental agreement.
Using a letting agent can help you to find reputable tenants as well as abide by all the relevant rules and regulations of being a landlord. Different letting agents will offer different services, so you can choose an agent that works for your needs.
Many landlords will manage their properties on their own, but a lot find it far more convenient to use a letting agent to help them. Think carefully about whether or not you want to manage all aspects of renting your property yourself or would you prefer a professional do this for you.
What Does A Letting Agent Do?
There are various levels of service offered by most letting agents, these include:
- Finding tenants: A letting agent can market your property and find suitable tenants on your behalf. They will collect references, organise credit checks, draw up the tenancy agreements and collect the deposits for you. Most letting agents will offer this service for a one-off fee, and once the tenant is in place, all responsibility is passed over to you as the landlord.
- Collect rent: You can arrange for a letting agent to collect rent from your tenants on your behalf. They will take the rent payments every month and chase any late payments for you.
- Full management: Most letting agents will offer a full management service where they will handle every aspect of the rental. This includes finding the tenants, taking the deposit, collecting rent and handling any queries or maintenance and repair work.
Most letting agents will have a lot of contacts such as plumbers, builders and electricians that they can call in should anything goes wrong in your property. If you don’t have these kinds of contact available, then it can be worth considering using a letting agent just in case any issues arise.
How Much Does A Letting Agent Cost?
Letting agent fees vary massively depending on the level of service you want and the location of your property. If you require an ongoing service such as rent collection or full management, they will usually charge a percentage of the property’s monthly rental income. This could be anywhere between 10% to above 20% depending on the service chosen.
For full property management, you can expect to pay around 12% to 20% of the total rent.
The letting agent market is competitive so be sure to compare several different companies before making the best deal. Many letting agents are also open to negotiation so don’t be afraid to haggle a bit to get a good deal.
How To Choose A Letting Agent
Choosing a good letting agent can make a big difference to your career as a landlord and your tenant’s happiness. You want to select a letting agent that is reliable, reasonably priced and friendly to deal with.
Try to pick a letting agent that knows the local market for your property well. If they are clued up on the area, then they will be better positioned to choose the right tenants and be able to give better advice on how much rent you should be charging.
Check if a letting agent is registered with an industry body or trade association. The main bodies to check for are the Association of Residential Letting Agents (ARLA), UK Association of Accredited Letting Agents (UKALA) and National Approved Lettings Scheme (NALS).
Try mystery shopping any potential letting agents by calling them and pretending to be a potential tenant. This will give you an idea of how they will handle your enquiry and keep your tenants happy.