Lettings property management: the role of an agent
Thu 17 Feb 2022
Gatekeeper, advocate, troubleshooter, & steward are just some of roles performed by a property managing agent. Dan Barradale, associate, Shouler & Son, outlines the value to landlords in using management services when it comes to rental property.
The temporary suspension of Section 21 evictions during the main period of the 2020 to 2021 lockdown was one of the lesser headline-grabbing measures of the Covid-19 pandemic orders. Similarly, the fact that a government white paper about the abolition of ‘no-fault’ Section 21 evictions is expected to be published this April (2022) is not something most people are reading about over breakfast now either.
The legal framework which governs Assured Shorthold Tenancies (ASTs) - the most common form of residential tenancy agreements - is just one of the regulatory pieces of knowledge that property managing agents possess.
And when it comes to types of rental tenures, ASTs are just one type of tenancy characterising our portfolio of over 1,500 tenanted properties we manage across five counties.
Given Shouler & Son’s pre-eminence in the rural sector in the region, we deal with farming tenancies too. This means our managing agents work to a separate set of tenanted property law in this regard.
The tenancy agreement is just the starting point for managing agents when it comes to the many rules and regulations governing let residential property.
Landlords - whether in possession of a substantial portfolio of let properties or just one or two properties - can only benefit from a managing agent’s extensive knowledge of all of a landlord’s statutory obligations and legal liabilities.
For a number of years now, landlords have been required, by law, to check the right to UK residency status of prospective tenants and can be held liable if any tenant does not have the right to remain resident in the UK but resides in the landlord’s property.
This is quite a complicated process and incredibly costly - on many levels, some with severe implications - if the checks are not carried out comprehensively and correctly. Yet residency checks are just one of the ’bread & butter’ tasks of a professional managing agent.
When it comes to matters of deposit and rent collection, bona fide managing agents will be members of recognised professional organisations such as the UK Association of Letting Agents (UKALA) and certified Tenant Deposit Protection Schemes. Such financial transparency protects the interests of landlords and tenants alike, and ensures fairness and diligence.
Even before deposits are secured, agents will carry out credit checks and take up references of potential tenants on the landlord’s behalf.
Compliance matters when it comes to the inspection and safety of utilities and related electrical, gas, oil and water installations inside and connected to any let property.
Regular checks and servicing of items such as heating boilers or electrical equipment must, by law, be carried out by the correctly qualified tradesperson. These inspections and any remedial work must be arranged in liaison with the tenant who needs to give consent to access the property at an agreed time.
Again, this is where an appointed managing agent gives ‘added value’ to landlords through its buying power when it comes to accredited tradespeople.
For instance, at Shouler & Son we have a core of trusted, local maintenance firms employing skilled and qualified tradespeople whom we regularly employ to carry out the statutory checks on a property and on whom we can call in the case of any emergency work in the let property.
Given the volume of properties we manage, we negotiate preferential rates from these service providers and we are able to deploy them in short order, should it be necessary, in a way a landlord of a small number of properties might not.
In representing our landlord clients, at the start of a tenancy we will explain to the tenants the type of scenarios that do constitute an emergency. This is then reinforced through the tenancy period by giving appointed contacts at our head office and ‘out of hours’ information tenants can access.
As well as protecting the fabric of the building when it comes to maintenance, managing agents take charge of inventories, organise end of tenancy cleaning and deal with any issues arising from these processes - or any other matters arising - at either end of the tenancy and all points in between.
Experience shows, more often than not, when landlords manage their own properties and have done so for some time, the rental levels they achieve are, typically, fairly low and not in line with current market values.
The business of agents is to know the factors in play in the local lettings market at any one time and to ensure their clients’ properties are ‘pulling their weight’ in reflecting the correct market value.
The insider knowledge of an agent will often see landlords in a more financially advantageous position when it comes to increased rental income that can be offset against agent’s management fees.
Lettings property management is offered by most property agents as a complementary, companion service to the more above-the-line and visible lettings agency service.
While complementary, it isn’t complimentary and, of course, there is a fee to landlords for this service.
Independent agents, such as Shouler & Son, who are not tied to a national fixed fee scale decided by a remote head office some distance from the managed properties can take a flexible approach to management fees.
These can be based on the landlord’s property portfolio in consideration of location, type of property and number of properties, among other factors.
It is of course, a landlord’s choice whether or not to appoint a managing agent.
However, we believe that, on balance, cost savings - both qualitative and quantitative when it comes to the fabric of the building and the removal of the potential for hassle - will, in turn, more than cover the a managing agent’s fees to the landlord.
For more information on Shouler & Son’s residential lettings property management services, contact Dan Barradale, tel 01664 560181, or d.barradale@shoulers.co.uk, or see shoulers.co.uk.