Should New Landlords Use A Letting Agent?

Bit late, but happy New Year everyone! I hope you all got shit-faced and participated in at least one stupid activity that you’ll regret for the rest of your life. I know I did, and that’s why I’m probably dripping with gonorrhea right now. All over my keyboard and shit.

Anyways…

A few days ago I was mooching around a couple of landlord forums, soaking up the trials and tribulations of my fellow comrades when I came across a thread where an upcoming landlord asked the question, “Should new landlords use a letting agent?” I’m sure it’s a question that gets pondered upon frequently by new landlords. I was tempted to reply to the lost soul and offer my advice, I even started typing, but I figured I’d hijack the question and answer it on my blog because I’d rather archive my precious wisdom on my own turf, as opposed to that poncy forum.

Before I chew into the crux of the matter, I should clarify that the user was referring to using a letting agent for managing his property. I’m pretty sure 99% of landlords use a letting agent, whether it be an online letting agent or a high street letting agent, to at least find tenants by generating leads. It’s the premium management service that is on trial today.

I’m sure everyone has their own take on the issue, but here’s mine…

Firstly, let’s give the question some perspective. If any landlord is pondering the idea of managing their own property, then there’s obvious desire, but also hesitation. The former is usually stemmed from the opportunity of saving money, while the latter is generally stemmed from inexperience (that’s important to the relevance of my advise). Straight off the bat, the landlord is prepared to manage his own property, as opposed to a landlord that categorically demands minimal involvement with letting their property, and is willing to pay the premium fees for that to happen.

With the emergence of online letting agents offering tenant-find services at puny costs, it’s become easier and more compelling than ever to go it alone. There used to be a time when the price-mark between a “tenant find” service and a “fully managed service” was relatively marginal (2-5%), so it often made sense to pay a little extra for the full package. But times have changed, online letting agents have ripped apart the price differential by a substantial amount, so now opting for the managed package will cost significantly more. However, despite that, I would still advice shiny new landlords to use a high street letting agent to manage their property/tenancy to start with if they’re unsure about which route to take. To some of my regular readers this may seem conflicting, because my philosophy on life has typically involved the demise of high street letting agents and their bullshit smuggy tactics, and I’m pretty sure I’ve written several feisty blog posts on why everyone should avoid letting agents like a bucket of anal warts. Strangely enough, if you had asked me a few years ago, I would have advised the landlord to fuck letting agents right off, and go it alone. But I stand here today with a different mindset, and I’m not even sure what changed. Perhaps I’m just wiser.

While I’ve had very few positive things to say about letting agents in recent times, I need to clarify that my opinions were formed from the perspective of a relatively experienced landlord, and I think that’s a crucial factor. I actually believe letting agents are suitable for three types of landlords 1) the inexperienced 2) those that want minimal involvement 3) overseas landlords. Every other landlord should be focusing on managing their own properties, because the figures don’t stack-up as well when using a high street letting agent and it really isn’t that difficult to do, especially if you find good tenants.

If you have zero experience as a landlord and you’re unsure which direction to take, then I would definitely advise using a letting agent, at least for the first year anyways. But let me explain a little more…

Learning from letting agents

The reality is, at least for most regular landlords, being a landlord isn’t as simple as collecting rent and taking advantage of some poor donkey that can’t get onto the property ladder to pay off the mortgage. Don’t be fooled by the pretty picture I paint of my lifestyle, it’s all smoke screens and mirrors, manipulated to mask the true bullshit nature of my poor and isolated existence. At this point, I’d just like to say, having you guys around.. well, you know. Just thanks.

Behind the glamour, there’s a lot of industry red-tape, so-much-so that it all takes is a small case of inexperience to force a landlord’s assets to reduce into vapour. Landlords have a lot of legal responsibilities, which new landlords may not acknowledge or address… and usually don’t, not entirely anyways. A letting agent will should (see what I did there?) ensure all your legal requirements are met e.g. securing the tenants deposit, acquiring an EPC and Gas Safety Certificate.

Aside from the legal jargon, there are other obvious formalities that come with being a landlord, like dealing with maintenance and repairs. It’s extremely rare (at least from my experience) for a tenancy to endure a year without requiring any maintenance. In fact, I’d be very worried if a tenant didn’t report anything during that time. When a problem occurs, a letting agent will contact the landlord and report the issue, and confirm what the next steps should be in order to resolve the problem. Going through small experiences like that will slowly make a landlord aware of how it all works (and how expensive it is to use the agents preferred suppliers. Just saying).

My point is, working with a letting agent is extremely useful and practical for gaining crucial knowledge and experience with in the industry, and it doesn’t even matter if you have a good or bad experience, because you’ll learn something either way. The premium rate you pay during that first year for a managed service from a letting agent will quickly be compensated for if you eventually decide to go it alone. You don’t really appreciate how extortionate and replaceable high street agents are until you gain a certain level of experience, and you can only really gain that experience by understanding the industry, and a lot of that is well learnt when working with an agent.

I’m the biggest fan of landlords managing their own properties, because I truly do believe it’s easy, and there’s so much money to be saved (mainly because letting agents are overpriced, in my opinion), but that initial knowledge gaining phase is best harnessed when sitting in the back seat. That’s an investment.

Finding a good letting agent

My main gripe with letting agents is that worthwhile ones are few and far between, but they’re definitely about (they’re all regular readers). But most of them shaft you left, right and centre, and they ruin it for everyone. Be under no illusion, finding a decent letting agent will be a challenge, and even when you find one, don’t be alarmed if you cry yourself to sleep due to their antics. Perhaps if good agents weren’t so scarce I’d be more willing to use their services more often, but it’s so hit and miss, it’s like playing Russian Roulette, and I mean that in the literal sense, because you may just end up blowing your brains out if you find yourself locking horns with an absolute dip-shit agency. It’s far less painful.

So while my advice is for new landlords to use a letting agent for the first year, the key is to find a reputable agent that won’t take advantage of your inexperience with their “quirky” pricing strategies and their blatant negligence and disregard of the law. For further reading, here’s a useful guide on how to find a good letting agent.

Something that landlords should be particularly wary of when choosing their letting agent is the contract agreement between landlord and agent- they’re often riddled with nasty clauses, designed to extract every penny out of the punter. For example, some agents won’t let the landlord keep the tenants if they decide to depart from their services. It’s a pretty outrageous clause, because the landlord initially paid for them to find the tenants. Read every clause carefully and ensure they’re not keeping you locked into their unsavory web of deceit.

After the first year

Most tenancies are fixed for 12 months, and after that year I would expect a landlord to have gained some limited experience, even while having little hands-on experience. You’ll also notice a few other things:

  • 1) you will have aged considerably quicker since you started dealing with tenants and agents. Get used to that. I’ve got grey hairs and wrinkles flying out of my arsehole, and I’m 12 years old.
  • 2) you will have learned about the industry, even if you didn’t intend to. You won’t be an expert, you may not even be competent, but you’ll be much better equipped than you were when you first asked the question of whether you should use a letting agent or not
  • 3) You’ll be in a better position to answer the following: “do you still want to manage your own property?” You may just realise you want minimal involvement and prepared to pay a letting agent to manage your property. Or you may even have a nightmare experience with an agent which will scar you for life and forever stereotype the bastards.

I just want to quickly refocus on the whole concept of finding a decent letting agent, because there’s one particular aspect with in that subject which is particular relevant during this stage. If you decide you’re ready for the challenge and you want to be the big-dick by managing your own property, there maybe issues keeping the existing tenants and prying them out of the letting agents grubby mitts (assuming you want to keep them). Some letting agents have the audacity to consider the tenants as their own even though you paid to source them. Essentially, some agents tie a “Tenancy renewal fee” into their contracts, so for each time you sign a new contract with the tenants they’re entitled to charge a fee, despite the fact you have wiped your hands with their services. In my opinion, good agents WILL NOT enforce this clause or any other that will make it difficult for a landlord to keep their tenants even after their services are no longer required. I advise landlords not to use agents that enforces those vulgar clauses. They’re shitty policies created to earn a quick-buck for doing nothing. Before using an agent, it’s best to ask what their policy/fees are in the scenario that you decide to abandon ship and tell them to stuff their shitty services.

For more information on this, hop over to the Tenancy Renewal Fees blog post.

The good tenant factor

When managing your own property, the success of the experience will largely depend on how good your tenant is, and in turn, how well you treat them. But the point is, there’s probably going to be a time when you land yourself a genuine dog-shit tenant, and when that happens for the first time it’s going to hurt. It’s going to hurt so bad. You’ll feel new levels of frustration and rage, and you’ll start to question your career choice, the legal system, and the integrity of your morals (because you will want to murder someone in the most sadistic way imaginable).

You probably won’t know what to do, you’ll panic, and you’ll probably regret managing your own property. But let me alleviate you from that irrational thought process- letting agents only take care of the day-to-day management, if your tenant turns rogue and defaults on rent for example, the responsibility and stress will always fall back onto your lap, whether you manage your own property it or not. The agents won’t lose a moments sleep over it. Ultimately, a good tenant is much more valuable than a good agent- you generally don’t need the latter if you have the former. No agent will care about your property and your best interest as much as you! It’s crucial to remember that.

Despite everything I’ve just said, if you want to go it alone and you feel confident from the get-go, I won’t discourage you!! In fact, DO IT! There’s plenty of resources and support on this website to assist :)

Over to you guys. What do you think? How would you answer the question?

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31 Comments- Join The Conversation...

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Benji 15th January, 2014 @ 14:28

Most tenancies are fixed for 12 months

Are they?

Why would a landlord tie themself into a new tenancy for 12 months rather than 6?

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The Landlord Avatar
The Landlord 15th January, 2014 @ 14:42

No real reason. But I've found that most tenancies are 12 months, but 6 months is also common.

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Benji 15th January, 2014 @ 14:57

The very real reason for 6 months over 12 is the ability to get the property back a lot quicker if things go wrong.

The minor advantages of 12 months are far outweighed by this.

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The Landlord Avatar
The Landlord 15th January, 2014 @ 15:02

You asked me why a landlord would opt for a 12 month tenancy over a 6 month tenancy, hence why I said "no real reason". You didn't ask me why a landlord would opt for a 6 month over a 12 month.

So no, that isn't a very real reason for what you asked.

Glad you've pointlessly picked out something so trivial and relevant to discuss.

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Nick 15th January, 2014 @ 23:14

Horses for courses. My property is very local, 5 mins away, just moved tenants in so have been able to pop over to sort teething problems out, get them to counter sign what seems like a ream of A4 paper and scope out what they are doing in the property without arranging an 'inspection'. It would loathe me to be paying some dipshit in an office to relay messages between us both, initiate someone to go an sort any little problems out and generally do a poorer job of looking after my property and tenants than I can do. On the flip side a friend used an agent for 'guarenteed rent'. I think the guarantee consisted of the guarantee to take a huge wedge of the rent each month, move undesirables into the property and to replace carpets and other damage with cheap materials. After he's bought the house back to standard he's flying solo.

Good tenants are way better than a good agent in my opinion, if you can find one without using the other then all's good.

Never mind the question though, more elaboration on the contracting of your clap is needed.

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SpongeBob 16th January, 2014 @ 00:27

Excellent article and highly relevant to my own predicament at the moment; I'll probably ultimately go it alone after this year but have spent ages doing the 'devils advocate' thing when weighing up different scenarios.

For my properties the probability is that the 'High Street' letting agent is routinely achieving a few percent higher than I could as a 'sole trader' because they enjoy prominence, reputation, and a front door for tenants complaints. This all translates into higher headline rent. Thus whatever fees are being charged by them for full management (say 12% of gross rent), probably half that is covered by the uplift in rent they in isolation can achieve on my behalf.

Plus, if you're still intending to pay a Tenant Find Service say 3-4% of gross rent, the residual uplift to me is down to just 2-3%, but I'm working much much harder now!

I suppose a lot depends on individual circumstance; do you have freedom to jump onto any issues in a timely fashion and then keep records sufficient to recover mileage expenses etc from the tax man(?); is the property knowingly going to be a maintenance headache or is it in concorde condition; is the agent able to outperform what you could achieve under your own steam in your local market or is it so established that not even Donald Trump himself could achieve the extra 5% in rent? etc etc.

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HMac 16th January, 2014 @ 08:46

At the moment I am in the process of buying another property, this time it is a house.

I have tenants in a 2 bed bungalow. These tenants wish to move to the house that I am buying. They pay the rent on time and I do not have any issues with the tenants.

Which leaves me with an empty bungalow. I am opting for the Agent to find the tenant only. On the basis that they will do the necessary vetting and screening. I am not going to do the managed property, as I live 100 and 200 yards from both the properties, and I have a builder friend who assists me with repairs. Why pay the Agent 10-15% for basically making 3 phone calls and telling you the prices quoted for the job. I can pick up the yellow pages myself and pick 3 out!

I do have a question though, if I were to get a bad tenant, what is the process for evicting them?

I am a fairly new landlord

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Mandy Thomson 16th January, 2014 @ 09:10

Some very good points made in your post.
After being a landlord now for more than three years, I've had both good and bad experience of letting agents.
I'd firstly like to say though that even though I had a very bad experience with one particular agent, I wouldn't hesitate to use them for introduction - the last one I used worked extremely hard to secure me excellent tenants at the rent I needed - even though it was a bit more than they wanted to pay.
You make the point that a lot of the management process depends on the tenants - getting the right tenant is absolutely crucial - good tenants (such as all of mine) will contact promptly when there's a genuine problem (such as damp or the boiler just won't work), but are self sufficient enough to resolve more day to day issues themselves.
Where I did have a bad experience was during the first year of my first let when I used a very small local agent for management - neither the company nor the agent were members of a letting agents association. I was living more than 100 miles from the property in a different city, working full time and completely inexperienced as a landlord. About 4 months into the let, a damp problem emerged. The agent called in a builder he regularly used - this person had done some work on the property prior to the let to a good standard. However, this time the builder turned out to be a complete and utter cowboy, but the agent still charged me his full fee for the work. When I got the "work" evaluated by other builders, they were frankly shocked at the very shoddy workmanship - however, when I pursued the agent, he simply went quiet.
From that point on, I decided to manage my own properties - although I'm reasonably competent at DIY - I've installed kitchens for example - I'm not a builder, electrician, plasterer or heating engineer - so when my tenants have had these issues, I have simply looked for recommended and accredited people online, just as I would if I were living there myself. My tenants are on the whole happy that I have responded promptly when repairs are needed.
The lesson I have learned is this - always use an agent who belongs to a professional body, and if you're using them for management, check that they have indemnity insurance, who they call for maintenance problems - and whether these people belong to trade associations such as Federation of Master Builders.

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maidbloke 16th January, 2014 @ 10:38

Interesting post. I have just become a landlord for the first time and I manage the property myself. One of the reasons I had the confidence to do that was this very blog. So - thank you.

I used a letting agency to find me a tenant, create the AST agreement and arrange inventory and gas/electricity checks. And they seemed to do that well. But from the moment the agreements were signed and exchanged it was down to me to manage.

I have owned property myself since 1993 so I have a good idea about maintenance. The property I let is local to me so I already know reliable plumbers etc. I figured that there was no need to pay for the full service from a letting agent. I am just as capable of answering the phone to the tenant and finding someone to unblock a drain as the agency is!

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Andy 16th January, 2014 @ 10:50

I have been a landlord for the last 3 years and now have 13 houses, all in the w.mids. I have only ever used an online agent service, this has always generated lots of potential tenants, normally about 8 viewings. I pay circa £60 - £80 and always ensure the property is on rightmove. I want to meet the people who may live in my investment property and build a relationship, for me, this starts at the first viewing. I aim to fix or get any issues sorted for tenants within hours/days and do not think that an agent could offer anything that i cannot achieve myself. I am not against managed services from agents and I think the three situations you mention are ones where i would consider using them. The one thing i have done along the way is join a landlords association, I am with NLA. This enables me to be up to date with laws/regs, provide me with documentation, and gives me a help line i can call when i am unsure about something (as yesterday when i needed to talk through prescribed info on deposits).

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Tinny 16th January, 2014 @ 12:34

I had to rent last year when the purchase on the property we were buying fell through and we sold our house. Our landlord was a great guy with lots of properties and a handyman on staff. The agent he used was a no nonsense guy who charged an introduction fee and only charged us what it costs to credit check both me and my hubby. This was a breath of fresh air because some of the agencies where we were looking were charging £500+ in admin fees etc. We had cats and had difficulty getting a property to rent despite me offering 2 months deposit to the landlord and extra money to cover pet damage insurance for landlords. I am pretty sure none of that was passed onto the landlord, as I would never hear back from the agents. We lowered our standard on properties due to this and I would see those properties still advertised months later, which I am sure is lost income to the landlord, especially if your rent is not competitive or your property is not as desirable as others in the area. When we did an inspection upon leaving, our landlord commented that the place was cleaner than when we moved in and we were extremely good tenants, we even forked out for an expensive dehumidifier so no condensation would form in the property which was prone to it, but I am sure many landlords were not given the chance to actually have an offer from us because agents were not bothered to check few things, such as if a landlord would accepts us with cats and with a 6 month clause. I still bump into our old landlord in local Starbucks and we have a coffee together. When new tenants turned up to view the place, because we had a good relationship, I made sure the place was tidy, clean and presentable and I sang praises about the agent and the landlord. The first set of people took it.
I think, as everything in life, what you personally put into something, comes back to you. No agent, even a good one, will ever be as motivated to let your property to good people as you will be to find good people for your property.

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Helen 16th January, 2014 @ 13:02

First things first - I am a letting agent. Now that confession is out of the way, I do agree with much of what is being said. Anyone can manage their own properties, if you are prepared to learn the law and either have good DIY skills or know good local tradesmen. Good people skills are also important, so you need to be able to chase the rent without feeling awkward and be firm when the tenant is making unreasonable demands.
If you have good tenants, the management is easy. The vast majority of properties we manage do have decent tenants, so we are making money for doing not a lot, BUT we are available to those tenants all day every day. Do you want to be phoned at home just as you are about to make mad passionate love or whatever?
All agents are not the same. If you decide to use an agent make sure that they belong to ARLA. This means that your rent money and the deposit are insured (in case we decide to bugger off to the Caribbean with your money)and our accounts are audited, so we can't embezzle you.
Another thing to look at is whether to use a national agent or a local independant. Where is the management based? The nationals usually have a central management department, so they are unlikely to be using local (cheaper) tradesmen. We are local, so we use the best, cheapest tradesmen we can find and we find out if someone has a bad reputation. Another advantage to using a local agent is that we will go to the property to see what the problem is, before we send someone out. Often the only problem is the tenant's stupidity! No charge to the landlord.
Another point to consider is whether you are prepared to argue over the deposit at the end. A local agent should just deal with everything. We will send in cleaners, carpet cleaners, rubbish removers and deal with the deposit deductions without even bothering the landlord.If a deposit is disputed, we prepare the landlord's case for the Tenancy Deposit Scheme, with inventory, check out, photos etc at no extra charge.
A good agent will guide you through rent defaults, evictions, CCJ's, bailiffs and all that crap without charging anything for the advice, although the procedures themselves do cost money and we do charge if we have to go to court.
Regarding renewal fees, we charge £50 for a new tenancy agreement, but if we are no longer managing a property, we wouldn't know if the tenancy had been renewed, rather than just moving onto a periodic tenancy, so we couldn't charge could we?

All in all, if you are prepared to deal with the crap, you can save a lot of money by self managing, but when things go wrong we agents really earn our money.

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Tinny 16th January, 2014 @ 13:18

I agree, Helen, that good agents do a lot for the landlord but are you saying you are available to the tenants 24/7 and you never make love yourself, you just jump in the car whenever a tenant calls? What if you are dealing with other tenants at the time/have other appointments?

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sam 16th January, 2014 @ 17:05

Great post - very insightful.

I particularly loved: "Don’t be fooled by the pretty picture I paint of my lifestyle, it’s all smoke screens and mirrors, manipulated to mask the true bullshit nature of my poor and isolated existence"

:)

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Helen 16th January, 2014 @ 17:42

Tinny, the point I was making is that WE are available to tenants all day. There are nearly always several people at an agents, whereas the landlord is on their own. I don't get called if I am at home or on holiday because there are other people manning the office. A landlord has to give their tenants their phone number, so can be called at any time.

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McLovin 16th January, 2014 @ 22:39

I have a mix of 1 self managed and 2 agency managed properties along with a full time job. When the tenancy ends I'm looking forward to turning the self managed one over to the agent who has been very good in all their dealings.

People keep mentioning cost of agents but you can claim their service back on tax. So it's not costing me a penny really as long as my tax bill exceeds my costs. I know this won't apply to everyone but it's worth pointing out for new/prospective landlords with jobs and only one or two houses.

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Joanne 22nd January, 2014 @ 17:36

Using an agent or not, if you get a crap tenant, nothing can be done anyway. I went alone and used my own noggin, I had to redecorate, re-carpet etc anyway, so I saved the money I would have spent on an agent, to do the property up in the end. The issues I had would have been there regardless.

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Phil 29th January, 2014 @ 11:00

I’m pretty sure 99% of landlords use a letting agent, whether it be an online letting agent or a high street letting agent, to at least find tenants by generating leads. – You know, I never used a letting agent, neither my friends (some of them are also landlords) did it. I can’t see the reason to pay someone money for the service you can do without any help. Jest let me explain it. When I want to find tenants I advertise my property at different websites (to make my chances bigger) like http://manchester.localmartuk.com/flats-and-houses-for-rent/ add photos of the flat (I think you’ll agree that many tenants choose the property according the photos they see) and leave my contact information so every person who is interested in renting will call me. The same thing my friends do. But, maybe when you want to rent your apartment for the first time, it’ll be useful to find a letting agent, who knows.

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Mandy Thomson 29th January, 2014 @ 12:28

@Phil - I agree with your post, but you haven't mentioned the selecting and vetting tenants aspect. The right tenant is critical - for someone inexperienced, or someone who doesn't know their way around the different referencing services and/or isn't confident interviewing people and able to hold their own in negotiations, I still say a good agent is crucial.

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Tinny 29th January, 2014 @ 12:58

Although I was never a landlord, I am now on a committee of two buildings that manage themselves. There a nice tenants living in two other flats on my floor and one has just had a bad leak. When we inspected it, it came down to a bad maintenance of the balcony window, which caused a slow leak that permeated the floating floor under the laminate as well as the wall next to the window (small amount of the wall as the window goes the length of the wall). The tenants only reported it when the laminate came apart from the damp. So now the job includes a new laminate for the lounge, new floating floor, repairs to the inside plastering and the original window. tenants tell me they did not see the landlord since renting the place in 2007. He bought an old flat and obviously did not do any inspections since and when I asked him what type of heating he has in the flat, he did not know, so this leads me to believe he is not performing the law governed gas checks.
He is now arguing the managing company should pay for the repairs that are his responsibility in the lease. Whilst I sympathise as I feel this was partly his fault and partly a fault of the tenants, who notices small damp patches but ignored them until it inconvenienced them, I do feel that no one, and this includes agents, will care about your property as much as you do. You can have good tenants but ultimately you never really know their personalities... these tenants pay rent on time but were pretty relaxed about mould showing in the corner of their window for a year. Everyone has different standards so if you want things done up to your standard, you are the only person for the job.

Vetting Mandy mentions is easily done through credit agencies. This costs very little yet agents sometimes charge a lot. Fees in london are something like £350 in referencing and admin fees to £600 so saving that and paying £25 per reference will also be something tenants will appreciate if you can spare the time.

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Fred 6th February, 2014 @ 13:18

@MacLovin

"People keep mentioning cost of agents but you can claim their service back on tax. So it's not costing me a penny really as long as my tax bill exceeds my costs. I know this won't apply to everyone but it's worth pointing out for new/prospective landlords with jobs and only one or two houses."

Not sure that you are right there.

Agent Charges are an expense, which means that you deduct the cost off your revenue before paying tax on the remainder.

Consider a case where the rent is £1000, the agent charges a fee of £200, and the tax rate is 30%.

In the Base Case there is no agent.

You receive £1000 income, and pay tax on that which at 30% is £300 tax, leaving you with £700 income after tax.

Consider the case with an agent.

You receive £1000 income, of which you pay £200 to the agent. This is a business expense, so you deduct it and tell the HMRC that your income is £800.

Then you have to pay 30% tax on £800, which is £240. That leaves you with £560 after tax.

So by using an agent you reduce your tax bill, but have still paid out the fee to the agent so your saving is the tax rate applied to your expenses, not the whole of the expenses themselves.

If you think about it, the £60 tax you have saved in this case will be paid to the HMRC by the agent in *his* accounts.

Am I wrong?

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Fred 6th February, 2014 @ 13:21

"This is a business expense, so you deduct it and tell the HMRC that your income is £800. "

Should read "taxable income". Sorry.

@McLoving, hope you haven't been deducting the entire agents fee from your tax bill.

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The Landlord Avatar
The Landlord 12th February, 2014 @ 10:29

Apologies for the late response folks, it's been a bit hectic at camp. I've only really had the opportunity to read through everyone's comments. A lot of good feedback! Few responses...

@Nick
"Good tenants are way better than a good agent in my opinion"- definitely!

As for my medical condition... it's still a sensitive subject (literally), but you'll be pleased to know the problem is resolved, and as a result, I now have a piece of my anatomy in a glass jar next to my bed. There was no other choice.

@SpongeBob
It genuinely does boil down to personal circumstances e.g. lifestyle. But also, as Nick said, how much (or little) work you do also depends highly on how good your tenants are. If you do the initial groundwork of sourcing good/reliable tenants, your workload could drastically decrease.

Most importantly though, nothing is set in stone. So even if you do take on all the responsibility, but then later on realise it's too much work, you can always use a letting agent again, even if only to offload a few properties.

@Helen
Your point about the potential disagreement about the deposit was spot on! That definitely is in favour of letting agents- because that's such a pain to deal with. Having said that, since the TDS was introduced, a lot of independent companies have emerged, that solely deal with inventories, and covers all that.

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Fee 16th February, 2014 @ 11:08

Hi,

Great post as usual!

I'm using a fully managed service with a letting agency for my property. But with my tenants contract still 4/5 months to run (who I want to keep on) things have turned sour with the agency (from them ignoring the tenancy agreement/lying to me). I now want to manage my tenants myself but the agents are saying I'm tied with them etc etc. Is there a way of getting out of this?

Sorry for asking the question directly here. Maybe a post on when things turn bad with an agencies what to do? I have a feeling it's more than commen!

Thanks,

Fee x

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HMac 16th February, 2014 @ 11:54

Tax

Yes its is some sort of swear word!

But I have found out something which I found interesting and I thought I should pass this on to others......

If the property is part-furnished you only pay 10% tax. If the property is not furnished you pay 20%

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Benji 16th February, 2014 @ 16:47

@HMac,

You've got it a bit mixed up. See this link;

http://www.hmrc.gov.uk/manuals/pimmanual/pim3200.htm

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The Landlord 16th February, 2014 @ 18:22

@Fee

It's been a long time. Too long :)

What does the contract say, the one between you and the agency? In theory, the tenant is the agent's client, that's why they're saying they are tied to the tenant.

I had the same kind of situation. There are often ways you can get around it, but it depends what is stated in the contract. For example, if you and the tenant legally terminate the tenancy, and then start a new one between yourselves, in theory, they may no longer be attached to the agency. However, then the agency may go after you for tenancy renewal fees (if that is stated in the contract). So you need to read the T&C's! x

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Fee 17th February, 2014 @ 17:25

Ahhhh ok, I will have a proper look then decided what to do.

But I think what will be probably best is creating a new contract and paying the renewal fees if I have to. As atm I'm paying 10% per month for the management service that I'm not happy with!

Thanks for the reply,

Fee x

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Colin Emmitt 1st March, 2014 @ 09:25

Be careful when choosing a letting agent and fully research them first. Don't just go with the cheapest deal. My wife and I have been stung for £2100. We bought our first property for investment to let out last August. The agent found tenants (personal friends). "Apparently a deposit in cash was made and the first months rent". We received nothing in rent and the agents did not make the deposit in the DPS. The agents then went out of business. We have from our pockets had to make the deposit into the DPS and lost two months rent. Despite me making the deposit our new agents have advised me I cannot lawfully ask for evidence that the tenants paid money over i.e a copy of bank statement.
The law sucks when it comes to landlord protection. Although I don't believe the tenant will but they could take us to court and claim 3 times the deposit monies because the deposit wasn't made in time and through no fault of our own. So be careful who you choose

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Alexandre 21st May, 2014 @ 15:03

Hello,
I'm working for a Dutch student start-up trying to facilitate the process of renting a room for a landlord for free.If you want to check our company at: www.nestpick.com
Hope to hear from you soon

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Neill 12th August, 2015 @ 15:12

Bought my first BTL last year, it came complete with a "lovely indian" couple.. who were indeed quite nice, however, their cooking habits have thoroughly pi**ed everyone off within a mile radius. Now they've gone after a long two month notice period, the place is mine again.. more's the pity.. IT STINKS.. everything is covered in ghee residue.
So a couple of long days of scrubbing & bleaching to the point of losing any traces of fingerprints on our hands, we finally started to give it a lick of MAGNOLIA..(just read the other post about this... should've done it sooner!)
Ok.. so my question is... Who can I bill for my cleaner? I accept that I was going to decorate anyway, so that's at my cost, but the agent said it was clean & it blatently isn't. there's handles broken that they didn't pick up on the inventory, c02 alarm broken, various bits n bobs.
Should I just invoice the agent?

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