We have a wide range of landlords who own anything from a one bedroom apartment to a large detached house, from a single property to a large portfolio.
All of our Landlords however have one important thing in common.
Their principle aim is to let to well qualified tenants who pay their rent on time, honour in full the terms of the signed AST (Assured Shorthold Tenancy agreement) and respect the property.
In most cases it is a typical small business model which is in place where yearly income verses expenditure (yield/profit) is critical, as is the condition of the property at the end of each tenancy.
Any void periods at the end of a Tenancy for redecoration and repairs are a most unwelcome expense and are at a cost to the business.
We would like to set out below, especially for novice landlords, how the rental business works and our role and the processes involved. It is usually in four stages;
- Pre-acquisition – where the landlord is researching potential investments.
- Acquisition – the process of purchasing a property.
- Ownership and management – through our fully managed letting service (the longest phase of the Landlord/Property/Agent/Tenant relationship)
- Exiting/selling up/leaving a legacy.
We are well prepared and able to expertly assist our landlords during these four stages.
All of the issues/problems which can be encountered in these four phases are well understood.
We always focus closely on prevention rather than cure.
These are some of the fears expressed to us, especially by novice landlords, keep an eye out for Part Two where we go into other concerns and issues.
“I’m worried that my tenant will just stop paying the rent.”
Prevention:
The best way to avoid a rogue tenant is not to let one into your property in the first place.
This means undertaking rigorous tenant vetting followed by the production and signing of a legally binding AST. We instruct HomeLet to provide us with comprehensive information on the tenant(s) application which can also include the tenants “ Right To Rent “ qualification.
Cure:
Naturally a proven ability to pay the Rent is central to any enquiries/decisions (Employer’s Reference). We may also decide to take a Rent Guarantor for additional security.
We always recommend that a landlord instructs our low cost Rent Guarantee (in association with HomeLet) so that the monthly/yearly Rent income is fully protected and legal costs are covered.
“My tenant has not paid their Rent”
Cure:
The first thing to understand in this situation is why? Has the tenant lost their job, suffered a personal crisis, had an accident, or spent the rent on their holiday?
There maybe a genuine and understandable reason why a tenant could be suffering a temporary cash flow problem. We immediately contact them and identify the reasons. If they have always been a good tenant, we try and come to an arrangement to get them back on track and up to date.
If they have constantly been late payers, then we would take a view in consultation with the landlord on whether or not to renew the tenancy
There are several stages to the rent arrears process and these include: Initial contact with the tenant followed by 7, 14 and 21 day late rent letters. Should the tenant fall 2 months into arrears this is a mandatory breach of the tenancy agreement and further action can be taken.
“I’m worried my tenant may damage the property”
Prevention:
The first thing to understand is ‘wear & tear’ is a business risk and the cost of being a landlord.
We however carry out quarterly inspections and ensure that the tenancy is running smoothly and the tenant is looking after the property. Damage to the property can be claimed for against the tenant deposit.
Cure:
If the tenant has caused some damage to your property, we assess the damage and see if it is fully covered by the deposit. We take photographs of the damage and can compare them to our inventory photographs.
At the end of the tenancy, we can give the tenant a statement of the deposit deductions to cover the cost of repairing the damage.
Having an extensive, accurate and pictorial inventory is hugely important in protecting the property and providing a strong case in the event of a deposit dispute.
“I’m worried about pets”
This is a common issue and landlords need to take a balanced view.
Prevention:
If the Landlord does not wish the tenant to house pets in the property then we make this very clear from the start in our brochure and an appropriate clause is entered into the tenancy agreement (AST). A landlord, acting on our advice, may allow for example a house cat or dog, with an increase in the rent/bond/deposit and a stipulation in the tenancy agreement that all carpets must be professionally cleaned at the end of the tenancy.
It is interesting to note that pet friendly homes can often achieve a slightly higher rent , be more rentable and that tenants generally stay for longer periods.
In Summary;
The best way for any landlord to avoid problems is to instruct a good ARLA registered Letting Agent and to listen carefully to the advice given and use the support available.
Naturally we believe that Myrings are the best and certainly the most helpful Letting Agent in town.
Always adopt a ‘belt and braces’ approach, take a long term view in order to protect your assets and to build a sustainable, profitable business.
Any short cuts, lack of due diligence, or lack of compliance will in our experience, always lead to bigger and far more expensive problems down the line.
Prevention is always better than cure in the Rental business. Prevention mitigates risk and reduces stress and serious liabilities.
Cure can cost a great deal of money and anxiety.
If you would like to discuss the Lettings marketplace in Harrogate then please come along and see Richard Chapman and the Lettings team and enjoy a free no obligation chat about the services we provide.
