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The Top 10 Essential Questions To Ask Before Appointing Your Letting Agent

A house for lease awaiting a letting agent

As a buy-to-let investor, choosing a letting agent can be a daunting task, especially if you’ve not let a property before. In order to find the right letting agent, you need to ask the right questions.  

1.    Are you a Member of the Association of Letting Agents (ARLA)?

As there are no industry-wide standards or legally-bound practices for letting agents, it is often difficult to know what service your letting agent will provide, and how much they will charge. If the letting agent is a member of the ARLA, The Royal Institution of Chartered Surveyors (RICS), or The National Association of Estate Agents (NAEA), then you know that they are part of a nationally recognised and approved body.

You should be looking for a letting agent that has demonstrated longevity in their role which proves that this is a career for them. Due to the stress of property management, staff turnover is high – you want to try to ensure that you will be talking to the same person in six months’ time.

Be sure to ask the following questions:
  • How many years have you been working in real estate?
  • How many years have you been with your current agency?
  • How can you demonstrate your knowledge of the current rental market in my area?

2.    How many Properties do you Personally (as well as the Company) Currently Manage?

Naturally you will want to go with an agency that has a reputation for having great letting agents. But you need to ensure that they are not too overloaded to look after your property carefully.

As a general rule, you don't want your letting agent to be currently looking after more than about 120 properties. If the agency has 450 properties on their rent roll, they should ideally have three or four agents to cover these.

3. How Many Tenants on your Books are Currently in Arrears? And what Action do you take if a Tenant is Behind in Rent?

Ask the agent to outline the company policy that ensures that you will be paid what your tenant owes you.
  • How often will your money be paid into your account?
  • How do they collect the rent from the tenant?
  • Do they enforce late fees?
Your letting agent should also provide you with a clear outline of their policy for what happens when a tenant falls into arrears.

4. What Happens if my Property Needs some Urgent Maintenance?

Many agencies will have a list of preferred contractors that they use to deal with emergency situations at your property and they’ll organise quotes and co-ordinate required work up to a pre-arranged financial limit. Some agencies will also offer the service to pay all property bills on your behalf if required. Make sure to discuss this with your agent to ensure that you are comfortable with the process.

Be sure to raise the following in conversation with your letting agent:
  • Are you able to pay for property bills on my behalf if required?
  • When will you contact me if there is a maintenance request?

5. What Methods Would you use to Market my Property and Attract Tenants?

This is an important question to ask. The last thing you want is the agent handing out your keys to prospective tenants and allowing them to view your property on their own. Instead, your letting agent should be present at the property whenever a prospective client is inspecting the property. They should have a database of quality tenants that are looking for a home as well as a clear marketing strategy in order to find quality tenants for you. Ask your agent how many days they are available to show the property to interested tenants and how they intend to advertise your property. Remember that many prospective tenants work during business hours and need to inspect on the weekend. A good agent will be available for open-house inspections on the weekends and after standard business hours.

Some examples of what you are looking for:
  • Online listings on websites such as Rightmove, Zoopla and PrimeLocation
  • A professional ‘To Let’ sign at the front of your property
  • Emails sent to past and current rental database
  • Advertising within the agency
Here are some important questions you don’t want to forget to ask:
  • Do you hand out keys to prospective tenants or attend each property inspection?
  • Do you have staff available to show my property to prospective tenants six days a week?

6. How do you Screen Tenants?

It should go without saying that a letting agent will do his or her best to personally screen potential tenants. The screening process needs to include a subscription to a major tenancy database and careful analysis of tenants.
When interviewing your prospective letting agent on his or her screening process, make sure you ask the following question:
  • Do you have a system for checking prospective tenants with regard to credit worthiness, past rental history and current employment?

7. How Many Inspections Per Year do you Carry Out? And at what Cost?

Many letting agents carry out quarterly inspections to make sure that your property is being taken care of by the tenants, but you can negotiate. Ask what sort of report you will receive and whether there is an additional cost or if it is built into your management fee.

If you have any special requests of your tenants, either inside or outside of the house, you need to make sure to include these in the tenancy agreement.

Start by asking these questions:
  • How often do you generally inspect properties?
  • Will you provide me with property inspection reports?
  • What other forms of communication can I expect from you? Will I receive: Monthly statements? Email updates? General market information? Maintenance issues? Rent reviews? Lease renewals? Warning about when tenants are vacating?

8. What is the Full Cost of Management? Please Detail all Possible Costs and Fees, and Indicate Whether these Fees Include VAT?

A letting agency isn’t allowed to charge you for registering with it or to show its list of available properties. As letting agents generally provide either a simple ‘let only’ or ‘full management’ service, fees can vary greatly. Ask the agency what the management fee includes and remember that these fees are always negotiable!Check the management contract very carefully and look out for the following:
  • A reasonable cancellation period – If you become unhappy with your agent, the last thing you want is to have to give six months’ notice; three months is a reasonable cancellation period.
  • Charges for when the property is vacant – the agent is entitled to a fee, but make sure that is less than when your property is tenanted.
  • Estate agency fees – this type of clause allows the letting agent to get an estate agent’s fee, if you decide to sell the property. You should never have to pay this.
  • Be wary of administration charges when new tenants go in. Although they are standard, make sure that you know how much they are and that you are happy with the figure.
  • Charges for services such as inventories, tenancy agreements, Energy Performance Certificates, Gas Safety Certificate, etc. Charges for these services are normal, but check to see that they are reasonable.

9. What is your Estimate of the Weekly Rental Potential of the Property?

When your letting agent answers this question, you should follow it up with; ‘What are you basing this on?’ The agent will need to demonstrate a good understanding of similar properties in your area and rents that they are achieving –from both their agency and others.

Be sure to ask:
  • On what are you basing your estimated figure?
  • What are tenants in similar buildings in the area currently paying?

10. How can you Ensure the best Returns from my Property? And what else can you do that Another Letting Agent can’t?

Property management is not just about collecting the rent. It is a comprehensive management service which should be provided by a trained letting agent. You want to find out what differentiates this property manager from his/her competition and what his/her strengths are.

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