Once you’ve found your ideal investment property, it’s time to find some tenants and just wait for the money to start rolling in. Easy, right? Well, not necessarily. Being a landlord can be a surprisingly hands-on role if you’re opting to self-manage your properties.
This is why we recommend working with a knowledgeable property manager, especially if you’re just at the start of your property investment career. With this in mind, we’ve collected five of our best tips for finding the right letting agent for you and your investment. Keep reading for everything you need to know about finding a great property manager.
Why work with a property manager
We see a lot of first-time property investors who get in touch with us for help with buy-to-let mortgages, property sourcing and/or sourcing tenants but who want to go it alone when it comes to the day-to-day management of their investment property. They’ll usually cite their wish to save money as their reason for doing so.
This is all well and good, but we do see many of these people come back to us shortly thereafter to ask for more support with their property. This is because most people are surprised at the level of work required of a landlord, from having to be on call 24/7 to all the red tape that comes with compliance issues.
To enjoy a truly passive rental income, you should go with a property manager. Especially if you’re also working full-time or have other responsibilities, this ensures you can still shine in these areas of your life. Especially for beginner property investors, this is typically the best way to go.
1. Decide on your level of management
There are, broadly put, two levels of support available from property management: tenant sourcing and full management. As you’d expect, the first option entails the sourcing and securing of tenants for your rental property as well as the initial paperwork involved. Sometimes you can add rent collection to this package.
Full management comes with these things as well as the day-to-day management of your property, including repairs and maintenance, property inspections, tenant relationship management and all paperwork.
Many letting agents offering full management will also ask for a small sum of money called a “float” so that they can carry out small repairs using this cash without having to get you involved you. This way, your involvement as a landlord is needed only if something very big comes up.
2. Look at their track record
Have a look at the properties the letting agent you’re considering is advertising on sites like Rightmove: this will show you how they typically market properties and how they’ve done in the area your property is located in recent months when it comes to securing tenants. After all, the longer your property sits empty, the longer you’ll have before you can start seeing a profit from your investment.
3. Gauge their level of competence
When you’re meeting with an expert property manager, they should be able to share with you an accurate estimate of the kind of rent you could ask for your property in its particular geographical location. This is why we advise you go with an agent in the same location as your investment property – this allows you to benefit from their local knowledge, especially if you yourself live a ways away.
It’s also important that you trust your gut: when you meet with the letting agent, how do they come across? Are they friendly and helpful as well as well-informed and experienced? Your first impression is likely to be very telling when it comes to the level of customer service you can expect.
You should also make sure you know how often your prospective property manager carries out property inspections and how your tenants can contact them in case they run into any issues. This way, your property will remain in a decent condition and your tenants can have the support they need.
4. Check they’re in accordance with local legislation
Your property manager should be able to get all the legally required paperwork in order before your tenants move in. These include gas and electricity safety certificates from the relevant professional engineers. They should also be able to ensure all soft furnishings in your property are compliant with fire safety regulations.
It’s important that your letting agent gets these things right because while they might be the ones tasked with these checks, legally speaking the responsibility remains with you, the landlord. To the same effect, you should also ask which government-approved tenancy deposit protection scheme they use.
You also need to make sure that your property management company is registered with the Scottish Letting Agent Register.
Similarly, we’d also recommend you check if the property management company you’re considering is accredited with a professional body such as the Safeagent (previously NALS) or ARLA Propertymark. This means they’re compelled to follow a certain code of conduct and meet certain standards.
5. Read the small print
This is important for avoiding some potentially exorbitant hidden fees. If a deal seems too good to be true, it usually is, and the property management company in question might be charging high fees for things that should really be a part of the standard package.
You should also make sure you know what your letting agent’s working hours are. Ask whether they always have someone available during the evenings and weekends – if they don’t, this could become an issue for both you and your tenants.
Finally, make sure you know what the agent’s notice period is for ending the contract, as well as familiarising yourself with their termination fees and clauses. For reference, two months is the most common answer for notice periods. And always make sure you keep copies of all receipts, paperwork and correspondence you have with your property manager.
How Cox & Co can help
If you’re looking to invest in buy-to-let property in Scotland, Cox & Co can help you every step of the way. Our property investment service is designed to provide you with a truly passive income, from property sourcing and mortgages to full property management. Our property management service can be tailored to fit your exact needs and our focus is securing reliable and responsible long-term tenants to maximise your return on investment. To find out more about our property management service, visit our lettings informational page.