The benefits of using a fully-managed service over doing it all yourself
A lot of landlords focus on ‘hassle’ when they’re deciding whether to use a managing agent. And there’s no doubt that taking phone calls from tenants, having to liaise with contractors, inspecting the property and being prepared to deal with any problems that can occur at any time, is time consuming. If you’ve got several properties, managing them and your tenants can easily turn into a full-time job and what do you do when you’re ill or want to take a holiday? Handing all that over to someone else to take of on your behalf can be quite a relief, not to mention that when there are issues with tenants, it’s very helpful to have a go-between who’s used to dealing with these kinds of problems.
But, from our perspective, there’s a much more important reason why landlords should take a fully-managed service.
Since Buy to Let really took off in the early 1990s, regulation of the industry has been a constant issue. Bad and illegal practice still carries on, despite the huge number of new laws introduced. There are now more than 100 rules and regulations that you, as a landlord, need to follow in order to let your property legally. These are being changed and added to all the time, and keeping on top of the changes is absolutely essential.
If you handle the letting and management of your property yourself, you’re taking on the full legal responsibility of it. So the biggest question you need to ask yourself is: am I sure I can keep up to date with all the industry legislation changes? That means knowing when new proposals are out for consultation and understanding how each new plan could affect your Buy to Let business. You then have to be sure you’re able to take the necessary steps to comply with new legislation, at the right time and in the right way.
Even when you do know what’s being proposed, changes can take months or even years to become law and there might be several amendments to policies along the way.
For example, the Immigration Act, 2014, which requires private landlords to check the immigration status of new tenants. The consultation was launched in July 2013 and the Bill had its first reading in the House of Commons in October 2013. It was debated in the Commons for nearly four months then took another three months to get through the House of Lords, before receiving Royal Assent on May 14th 2014. Nothing further was reported over the summer, then in September 2014 it was announced that ‘right to rent’ checks would be piloted in the West Midlands, beginning on 1st December 2014. The results of that pilot have yet to be reported but the policy is expected to be phased in across the UK this year. That’s probably not going to make big headlines, so self-managing landlords will need to make sure they have a way of knowing when they’ll be affected.
By subscribing to the Residential Landlords Association (RLA) or National Landlords Association (NLA) you should be informed about new regulations, but you’re relying on someone else to give you the right information at the right time - and post or email communications can go astray. A further complication is that many regulations, especially ones that relate to the housing health & safety rating system (HHSRS) and HMOs, are interpreted in different ways by different local authorities – for example:
- In Oxford, if there are three or more tenants, forming two or more households, the HMO must be licensed.
- In Poole, the property only requires a licence if there are five or more people, forming two or more households AND the property has three or more storeys (national mandatory licensing criteria).
- In certain areas of Nottingham, where additional licensing for HMOs has been introduced, the policy is the same as for Oxford; in other areas, only national mandatory licensing applies, as in Poole.
- Nationally, England and Wales used to have the same regulations; now Wales has its own legislation regarding mandatory registration and licensing for all property managers. You also need to be aware of amendments to consumer rights, planning laws and building regulations, all of which can vary from area to area, making it incredibly difficult for landlords who have properties in different parts of the UK to keep track of what’s required in each area.
There really is a huge amount for you to keep up to date with and if you miss something and fall foul of the law, it could result in fines and even prosecution.
By far the best way to make sure your properties are always let legally is to put yourself in the hands of professionals. As self-regulated agents, it’s our business to know about national and local housing policy changes and we have the infrastructure in place to stay informed and make changes as and when we need to. We also get involved in consultations over proposed legislation, speaking up for the interests of landlords and agents and, being a national group, we have a significant voice.
When you’re choosing an agent, make sure they have a good local reputation and are a member of ARLA (as we are), RICS or NALS. That means they’ll be trained and kept up to date on legislation, properly insured and able to act on your behalf in the case of any tenant disputes. At Your Move, we also pride ourselves on the fact that all our team members have excellent local knowledge and can advise our landlords about what to buy and where, as well as how future changes to the area might affect them.
If you’re not currently under full management with us and would like to talk about how it could boost the success of your investment, pop into your local branch or email landlords@Your-Move.co.uk – we’re always here to help and advise.