Are management companies worth the fees? This really depends – on how much time you have to spend on the day-to-day running of your property, your level of knowledge and how involved you would like to be.
Maybe you're investing in buy-to-let, or you’re an accidental landlord with an inherited place to rent out. Working out how you’ll manage your property or portfolio is one of your first big decisions.
You might opt to use a residential property management company. They can certainly offer peace of mind by taking some of the stresses and strains of being a landlord. They can liaise with your tenants and look after maintenance to ensure your property investment brings a good return.
But are management companies worth the fees? This really depends – on how much time you have to spend on the day-to-day running of your property, your level of knowledge and how involved you would like to be.
What does a property management team do?
Using their knowledge, expertise and contacts, a management company will keep residential properties well-maintained and legally-compliant. They make sure that vacant homes are filled quickly and that tenants find the right properties for them.
Property managers are often the main point of contact between landlord and tenant. They can help landlords with everything from collecting rent to managing repairs – their level of input will largely depend you, your needs and your budget.
A property management company might also be appointed by the freeholder of a block of flats to maintain the whole development. This block manager may also collect service charges.
A management company can help you source good and reliable tenants. They can advertise your property, show people round and agree the rent. The management agent will carry out background reference, passport and credit checks on your potential tenants too.
With their property experience and legal know-how, they can draw up a lease for you. They can also prepare an inventory and state of repair assessment of your property to protect it from damage.
Once your tenant has signed the lease, the management agent will help with the financial side of your arrangement. They can collect the deposit and on-going rent on your behalf; making sure it’s transferred to your bank account and that you receive regular statements. They can also deal with missed payments and re-negotiation of the rent.
Dealing with repairs and legal issues
Your letting agent can manage repairs too. They can carry out inspections periodically and respond to reports of issues from tenants. Depending on the level of input you agree, you can authorise your agent to carry out emergency repairs without bothering you at all.
As agents need to keep on top of the latest legal and health and safety requirements for landlords, they will make sure your property complies with the law and good practice at all times.
At the end of a tenancy
If you want to end the tenancy, the managing agent can give notice to your tenant and carry out the necessary end-of tenancy checks - of the inventory and condition of the property. If your tenants have decided to move on, the managing agent can ensure the place is re-let as quickly as possible, avoiding any loss of rent through down-time.
And if you’re unfortunate enough to have problem tenants, an agent can deal with tricky issues, such as eviction, harassment or squatting, on your behalf.
Is it right for you?
Think about how much time you want to devote to managing your property. Also think about how much experience and knowledge you have about the practical and legal aspects of being a landlord.
One benefit of using an agent is being able to draw on their expertise in a number of areas. As letting properties becomes ever more complex, the need to keep on top of the latest rules and regulations is growing. You should be able to ask your agent about anything – from gas safety certificates to spotting a fake passport or knowing where to find a good plumber.
Choosing a management service
Choosing an agent to manage your property is a very personal decision. Start by looking at their credentials. Check they are members of Association of Rental Letting Agents (ARLA). ARLA lists qualified residential management agents on its website
Get personal recommendations from friends or colleagues, who let property too. Then get in touch with agents working in your area. Talk to them and make sure you understand the services they are offering, their terms of business and what will be included in your package.
Fees will be charged as a percentage of your gross income – look for best value, not the cheapest rate – think about what is being offered in return for the fee.
If you’re new to letting, talk to our leading property rentals team at Plaza Estates. We can help you find the right tenant and help manage the process for you, so please do call us today