Should you or should you not? There is a risk factor involved in almost every decision that is taken. The same applies to the property market when considering whether to be a DIY landlord or to use the services of a Letting Agent. Of course, various other factors also need to be pondered. If there is more than one tenant and property, then time is essential – whether you have sufficient time to self-manage.
There are many advantages on both sides. Letting Agents, including the top Letting Agents in Berkhamsted, can be of enormous help with managing tenants and properties. Depending on the circumstances, self-managing your business can provide great satisfaction too. We look at the pros and cons.
Self-management – Pros:
Saving money: The letting agent’s fees range according to the coverage of the property management, especially if there are two or more properties. The management fees will rise along with the rent increases. By self-managing, you are able to save a great deal of money. Even though you will need tax advice and an accountant to submit your tax return, it will be less expensive.
Maintaining standards: By self-management, you can set and maintain standards for your business. With agents, you cannot remain passive. Follow-ups on the letting agent need to be made to ensure they are carrying out their duties as agreed to.
Property portfolio: Self-management creates an opportunity to focus on the portfolio. Areas where business costs can be lowered, suppliers are less expensive suppliers, maintaining standards at lower costs can all be researched. This will enhance awareness for growth and profit, developing skills in research, people, project and finance management.
Tenant relationships: Personal contact with tenants, if there is a good working relationship, is mutually beneficial. Tenants are more likely to take care of the property and, by word of mouth, be a reference for other properties you may have. Also, they will probably stay long term, keeping you free from vacancy worries.
Self-management – Cons:
Effort and time: Property management is no longer submissive. There is always work to be seen to, not just at the time of entry or exit of a tenant. Properties need to be maintained, finances kept up-to-date, lease agreements and renewals to be completed and a number of rules and regulations to be adhered to.
Stress: Since you are the only contact person, any emergencies like water leakages, fire or electric problems will have to be dealt with by you. You will be on call 24/7 and will have to deal with difficult tenants and their problems. This can be stressful.
Letting Agent – Pros:
Time saving: A Letting Agent will offer various services including preparing the property for rent, advertising and marketing, arranging viewings, assessing tenants, seeing to safety and security norms, abiding by rules and regulations including property inspections, administrative work including preparing the lease agreement, arranging for the deposit, rent collections and seeing to the maintenance. This can save a busy landlord a great deal of time.
Expertise: With professional knowledge of the market, Letting Agents will probably obtain a higher rent. They are aware of current legal matters concerning landlords and tenants and act as the middleman between you and your tenants, helping to resolve any issues. Letting Agents can also offer insurance and tax advisory services to the landlord.
Quality: Getting the right Letting Agent can be priceless. Even if the fees are a little higher, if the agent is well qualified, respected and has good contacts in the local market, then it will be worth it. They should be members of a professional body and have a client money protection scheme. The details of services offered (whether let only or fully managed) should be clearly defined.
Letting Agent – Cons:
Expense: For all the work they undertake, fees are payable, depending on the services offered. If it is a fully managed service, the fees will automatically be higher. Ensure that the services offered are clarified for what you are paying.
Additional charges: Any extras such as arranging repair work or obtaining EPCs or GSCs, if not mentioned in the agreement, may be chargeable under various fees, so these should also be checked out.
Conclusion: Using a Letting Agent will be more convenient, unless you have the facilities to self-manage your property. However, your personal circumstances, especially finance and time, will probably be the decision maker. Also, if you do not live close to the properties, then it is probably feasible to employ a Letting Agent. Using a Letting Agent means you are allowing someone else to take control. Committed Letting Agents will ensure the success of the investment while others may not show such dedication. Hence, it is relevant to take this factor into account. By studying the above pros and cons and with some additional research, we are sure that you will make the right decision!