Choosing the right agent
Despite the industry being governed by legislation, the same cannot be said about Letting agents.
Anybody can set up as a letting agent without qualifications, industry experience or knowledge of the Law affecting the industry. There are no specific legal controls of working practices or of the handling of client monies.
Unlicensed agents often fly by the seat of their pants. When things go wrong it is the landlords and tenants who suffer. This can mean badly managed tenancies, disgruntled tenants, spiralling rent arrears and, in the worst cases, damaged properties, landlords being sued and client money disappearing.
It is therefore essential to choose an ARLA licensed agent.
ARLA, The Association of Residential Letting Agents, is the industry's governing body which sets policies and promotes industry standards and best practice.
Licensed ARLA agents must comply with a strict code of practice, including securing client monies in designated client accounts; join a client money protection scheme and be a member of a recognised ombudsman scheme.
You get what you pay for
The first criterion used by many Landlords when choosing a Letting agent is the commission charged. This is often ill-conceived. Invariably, as the price comes down, so does the quality of service. In this business, quality of service is paramount.
Other key questions to consider when choosing an agent:
- Does the agent have ARLA trained and qualified staff?
ARLA sets and controls the industry's training and examination programmes. The industry qualification, The Technical Award in Residential Lettings and Property Management, comprises an exacting four part programme of study and examination. It is comprehensive and demanding and it has greatly enhanced the status of the profession and the qualified individuals practicing within it.
- Does the agent have sufficient industry experience to offer a professional service?
How Long has the agent been established? Do they understand the regulations and Law relating to the industry and, more specifically, statutory procedures covering such events as serving notice, chasing arrears and repossession?
- When an agent offers a rental value ask them for evidence. A reputable agent will research the market to assess rents of similar properties being marketed and recently let. Less reputable agents often inflate the rental value to win the business.
- Does the agent have a comprehensive tenant referencing procedure
including identity check, proof of residence, professional credit check, proof of income and previous landlord reference where appropriate?
- Does the agent insist on a professional inventory/schedule of condition?
This sets the benchmark for the condition of the property at the outset and is often the critical evidence used in deciding disputes. Ask to see an example.
- Does the agent conduct regular property checks and produce a landlord report?
Ask to see an example.
- How does the agent administer deposits and deal with any disputes?
- Is the agent a member of a recognised ombudsman scheme?
The Property Ombudsman (TPO) scheme provides a free independent service dealing with disputes between member agents and landlords or tenants of property in the UK. Member agents must follow The Property Ombudsman Letting Code of Practice, which sets out the framework within which member agents should operate and the standards of service they need to provide for both landlords and tenants.
- Does the agent operate from high street shops that are visible and easily accessible to landlords and prospective tenants?
- Does the agent have an effective marketing programme to procure tenants?