Use a Letting Agent or not?

The Minstrel

Hello All,

Thinking of renting out my flat in its entirety. The location of the flat pretty much guarantees getting tenants, however I was thinking about handing it over to a letting agent to avoid any associated hassle that tenants could give me.

What would people say are the pros and cons of using letting agents? How much do they generally charge and is it worth it?

Thanks

J-blk

Ask most tenants here and they probably won't have positive experiences with letting agents... Unless there was some really compelling reason (you're leaving the country and don't have any family/friend that could let your property for you), I'd stay well away from letting agents. Most of the "messing" will come from them not the prospective tenants... Even in the current climate, I've dealt with numerous agents who don't even have the decency of returning a simple phone call when I inquired about various properties (which then remained empty for substantial amounts of time).

What do you think a letting agent will do for you anyway that you can't do yourself?

Graces7

The reason most use a letting agent seems to be that they cannot handle the paperwork and advertising. eg the PRTB registration etc

Threshold and PTRB have very helpful info on their web sites. With the Tenancy Act things are easier now.

And daft ie are a good advertising place.

If that is not a problem?

J-blk wrote: »

Ask most tenants here and they probably won't have positive experiences with letting agents... Unless there was some really compelling reason (you're leaving the country and don't have any family/friend that could let your property for you), I'd stay well away from letting agents. Most of the "messing" will come from them not the prospective tenants... Even in the current climate, I've dealt with numerous agents who don't even have the decency of returning a simple phone call when I inquired about various properties (which then remained empty for substantial amounts of time).

What do you think a letting agent will do for you anyway that you can't do yourself?

eth0_

I've used about three letting agents in Dublin before (as a tenant) and not one of them checked my references.

And in one case I stopped paying my rent for three months (there were a lot of problems in the flat that the letting agent said the landlord would have to give the go ahead to pay for, she was living in India and the letting agent somehow could never get hold of her, this was literally a last straw attempt at getting the woman to take notice!) and the letting agent never even noticed.

Definitely do it yourself, just ensure you know the laws surrounding renting out property.

antoinolachtnai

Whether you use an agent or not, be sure you know the law about letting property!

I am not an agency 'fan', but be warned, the job of actually letting property takes a good bit of time at the moment, if you have a distance to travel to/from the apartment. It can take a good few viewings before the thing will actually let for you, even if it is an attractive property.

There are two separate things - letting the property, then managing it. They each have their own challenges.

bugler

Again I can only give you my experience as a tenant, not a landlord, but they are mostly a waste of money. Two things can happen when you use a letting agent:

1. They get good tenants and everything goes fairly well with the tenancy. They have to do very little bar arrange initial meter readings and refund deposit etc through the course of the tenancy. Note some of them can't even manage that much. But all going well, the letting agent gets money from you for doing nothing.

2. They get bad tenants and/or the tenancy is riddled with problems (repairs and so on). Whenever anything goes wrong they are going to come to you with the problems. Sure, you may be spared having to call the plumber yourself, but is that really worth their fee? If things go very bad with the tenancy and the tenants stop paying rent, there's only so much a letting agent can or will do. They're not going to chase the tenant down legal avenues or take them to the PRTB for you. As soon as things get heavy it will be back on you like a hot snot.

If you're absolutely dead set on not interacting with your tenants then maybe you should use an agent. But then if you are that intent on avoiding contact with them you might want to ask yourself why you're a landlord.

Personally I think you should go for it yourself. As I outlined above, if things go great with the tenancy then it's money for nothing. If things go badly you're going to be the one who deals with it anyway.

Meet your propsective tenants, look them in the eye, have a chat with them. If they "feel" ok to you, check references. Most agents can't be bothered to go to these short lengths. Be accessible to your tenants and make sure your place is in good nick. If you want to be treated well as a landlord then treat your tenants well. With a bit of luck you'll have a hassle free tenancy and can pocket what you would have handed over to someone with little enough interest in handling your affairs.

Graces7

All the agent did with our last bad landlord was pass messages back and forth.

Both agent and landlord forgot that the lease had run out and as we knew we might need to move we just waited.

PTRB and Threshhold have excellent information for landlords

http://www.prtb.ie/


http://www.threshold.ie/

bugler wrote: »

Again I can only give you my experience as a tenant, not a landlord, but they are mostly a waste of money. Two things can happen when you use a letting agent:

1. They get good tenants and everything goes fairly well with the tenancy. They have to do very little bar arrange initial meter readings and refund deposit etc through the course of the tenancy. Note some of them can't even manage that much. But all going well, the letting agent gets money from you for doing nothing.

2. They get bad tenants and/or the tenancy is riddled with problems (repairs and so on). Whenever anything goes wrong they are going to come to you with the problems. Sure, you may be spared having to call the plumber yourself, but is that really worth their fee? If things go very bad with the tenancy and the tenants stop paying rent, there's only so much a letting agent can or will do. They're not going to chase the tenant down legal avenues or take them to the PRTB for you. As soon as things get heavy it will be back on you like a hot snot.

If you're absolutely dead set on not interacting with your tenants then maybe you should use an agent. But then if you are that intent on avoiding contact with them you might want to ask yourself why you're a landlord.

Personally I think you should go for it yourself. As I outlined above, if things go great with the tenancy then it's money for nothing. If things go badly you're going to be the one who deals with it anyway.

Meet your propsective tenants, look them in the eye, have a chat with them. If they "feel" ok to you, check references. Most agents can't be bothered to go to these short lengths. Be accessible to your tenants and make sure your place is in good nick. If you want to be treated well as a landlord then treat your tenants well. With a bit of luck you'll have a hassle free tenancy and can pocket what you would have handed over to someone with little enough interest in handling your affairs.

The Minstrel

Hi All, thanks for advice. I'm writing from a Landlord's perspective, and the reason why I was considering using a letting agent is because I don't know anything about leases etc. I just want to cover my ass in case I have a problem with the tenants, also perhaps landlords could suggest a few things to be careful of. Can anyone point me in the direction of a sample lease agreement?

Porkpie

Hi Minstrel,

Get your free lease here

http://www.topfloor.ie/lease.php

Also

www.irishlandlord.com

The above site is a Godsend. Everything you need to know about becoming a landlord is in it.

I agree with the other posters, just do it yourself. My brother used a letting agent before and they let a pair of scumbags in who wrecked the house. Obviously they didn't vet them properly at all.

Best of luck.

3DataModem

The Minstrel wrote: »

landlords could suggest a few things to be careful of.

There are two types of services a letting agent will provide;

(1) Finding tenants (inc. leases, references, standing order, etc)
(2) Management of property (dealing with problems)

Some charge separately for each, some charge an all-in price. The important fact is whether the agent charges the finding tenants fee each year, or only on change of tenant.

E.g.

Sherry Fitz charge 10% for management and 7% for finding tenants. They are by far the most expensive out there.

Others charge 7% for management and 7% for finding tenants.... that's actually pretty standard.

Others charge between 10% and 14% "all-in" irrespective of how many times they need to find tenants. I find this the best sort of structure as it motivates the agent to find good tenants rather than any old tenant, so they have to show it less etc.

Trying to do it yourself is great when everything is fine, but wait until the washing machine breaks down on a Sunday when you are on holidays and get ready for a world of hassle. The great thing about an agent is a good one will have a plumber on call who'll make the repair etc and the agent just bills you.

I have done both (managed myself and hired agents to do it) and it all depends on how easy to maintain the property is (e.g. new apts have a lot less problems than 30 year old houses!) and how close you live/work to it AND whether you are handy at repairs etc yourself.

Ask the agent;

(1) How many rentals he has on his books
(2) Ask how many people work in his office on rentals
(3) Ask does he have access to workmen for repairs etc
(4) Is he local
(5) Does he advertise on DAFT / Myhome

If the apartment is in Stillorgan and the agent is in town then it is pretty unlikely he'll be able to do viewings at the drop of a hat - less viewings = less rent for you.

I would always suggest going for a local agent who uses Daft and Myhome with a few people in the office who manages a lot of property. Stay away from the big "selling" agents; they will not give your business the time it deserves.

Also pick one that gives an all-in price (negotiate!) irrespective of the turnover of tenants. That motivates them to get good tenants. I would also suggest that you are better off with one who collects the rent then sends it to you net of fees (so you don't have to check that the rent is coming in!), but this is not a huge deal.

Where is the apartment? I may be able to recommend an agent or two...

Thinkingaboutit

If you can get a good one, they can do a smashing job. Still, I would only go for one if the flat would otherwise be hard to rent out. Leases are not too hard to do. A solicitor does the first one and an addendum can be done yourself. Templates can be got I think.

3DataModem

Also a word of advice;

(1) Leases aren't worth a damn if the tenant wants to be difficult, so make sure you can afford to have no rent for 3-6 months "just in case".

(2) It is FAR FAR FAR more important to have a good tenant than to have high rent. Take it from me. I will routinely take 10%-20% less than the market to ensure I have pick of the tenants; it also ensures they are more likely to stay on for 2 or 3 years. Don't obsess about how much you will get.

(3) Don't put expensive furniture in the place. After 3 or 4 years it all goes in a skip anyway. No matter how well the tenants treat the stuff, wear and tear is going to happen and you can't get upset about coffee rings or scratches on your lovely coffee table or biro marks on your lovely sofa. Ikea + Argos = everyone's happy. Many first time landlords make this mistake and buy expensive stuff for their rental properties; I'm not saying buy crap - just get the standard beds / sofas etc in Argos / Bargaintown and depreciate them against tax... you can get really attractive stuff for next to nothing. Check out the lovely wood beds in Argos or the Sofas in Argos. It also means that if something is damaged you simply replace it without sweating it. I had a tenant who broke a sofa (presumably riding or horseplay or kids)... I asked him to just go out and buy a replacement for up to €300 anywhere he liked and knock it off the rent AND SEND ME A COPY OF RECEIPT! I still have no idea what it looks like or what colour it is, and I don't care!