With the government banning letting agents in England from charging fees to tenants, some landlords are considering using their services to rent out properties. At present, letting agents can charge tenants for their administrative services such as taking up references, drawing up tenancy agreements, credit checks and immigration checks. However, this is to be stopped and many landlords fear these costs will then be passed on to them
According to the latest Private Rented Sector Trends report by Paragon, up to 30% of landlords will be put off using the services of letting agents because of this change. As they are already facing increased costs through tax changes, stamp duty on second properties and mortgage squeezes, any rise in letting fees could be a step too far. They are considering either moving their business elsewhere or carrying out this extra work themselves.
The study found 73% of landlords questioned currently use an agent or third party for letting their properties. Of these, 12% said they would definitely be discouraged from doing so if the fees went up, while 18% said they would probably think again about using an agent. That means the majority are not put off and are happy to continue. The report also reveals that 27% of landlords already undertake this work themselves and, of these, 84% do not charge fees to tenants. The most common fees that landlords will pass on to tenants are for credit checks, inventories, references and tenancy agreements.
Letting agents are also facing competition from a new online property lettings website, HomeRenter, backed by newspaper publisher Trinity Mirror, which offers to cut out the role of letting agents and their fees. This portal will make its revenue by charging landlords an annual membership to showcase their properties. Basically, the business will cut out the middleman to create a situation where landlords and tenants deal directly with each other.
As well as using new online companies such as No Agent or Homerenter, landlords can also invest in software to simplify the administrative work for them. Property inventory and inspection software enables landlords to schedule and track reports online. For instance, property visits can be scheduled, check-ins arranged, professional inventories set up, contracts completed and bookings accepted directly from tenants. All of the paperwork is kept in one place, so it is easily accessible and stored online, so all members of the team can access it.
If you’re a landlord and you’re looking for a smarter way to complete property inspections, try InventoryBase today for free.