When you become a landlord – whether by accident or design – one of the key decisions you’ll need to make is whether the manage the lettings process yourself or use a lettings agent.
Here we look at the pros and cons to help you decide which is the best option for you.
There are 3 main options available to you:
The first option is really only viable if you live near your property(s).
Advertising for tenants, organising and accompanying viewings, carrying out the relevant checks and sorting out the tenancy agreement can all be very time-consuming. So even experienced landlords like to leave this to the professionals. And there are plenty of pitfalls for the inexperienced.
Once your tenant has moved in, hopefully things should run smoothly. The rent will arrive in your bank account on time and there won’t be any maintenance dramas. But if you go for self management, you will be the one who gets the phone call when the boiler breaks, the shower starts leaking or the cooker breaks on Christmas day.
Letting your agent sort out the niggles, chase arrears and organise plumbers/electricians/locksmiths etc is a service many landlords feel is worth the cost.
As a landlord you need to comply with a whole heap of laws and regulations.
From ensuring the safety of your tenants to making sure your tenants have the right to rent your property.
Let your home in England to someone who doesn’t have permission to live in the UK and you’re in line for a large fine (up to £3,000 at the time of writing – January 2019). And, by the way, you can’t get round it by only renting to English people – that leaves you open to a claim for discrimination.
There are gas and electrical safety checks, fire regulations and the need to maintain the property so that it’s safe.
Regulations change regularly and keeping up to date with them and arranging the checks is time consuming (and pretty boring too).
Which is why most small landlords decide it’s not worth the hassle and get their lettings agent to take care of everything. You stand to lose a lot more than the monthly management fee if you decide to DIY and get it wrong.
The downside of letting an agent take care of it is, of course, having to pay for their service.
Not all lettings agents are the same, so take the time to check what is and isn’t included in the fee.
A good agent (like The Property Hive!) will do all the above plus carry out routine inspections each quarter to check the property is being looked after properly and there are not outstanding maintenance issues. Many tenants fail to report these and they can seriously deteriorate the property. Most DIY landlords never bother to do this and always get nasty surprises when they finally see their property years later when the tenant has moved out.
When weighing up the pros and cons, it’s worth thinking about how much your time is worth.
If you are retired with just a couple of investment properties to care for, you may be happy to do whatever’s involved in order to maximise your income.
If have a full time career plus a family demanding your time and attention too, then handing it all over to a agent makes sense.
Remember that management charges count as an expense so are tax deductible.
Our advice? If you want to be a professional landlord with multiple properties and are happy to be “hands-on”, then managing them yourself will let you keep more of your rental income.
But for everyone else - the “accidental” landlord, busy professionals, those living some distance away - let someone else do the hard work.
If you’re thinking about becoming a landlord in Doncaster then we’d love to help. Give us a buzz on: 01302 247754 or email us at: firstname.lastname@example.org