A new study of over 2,000 landlords reveals that only a quarter of them instruct agents to fully manage their investment properties - and just another 15 per cent use agents on an occasional basis.
The survey - for Landlord Today and Letting Agent Today - was conducted on Twitter by industry supplier Hamilton Fraser, the parent company operating Total Landlord Insurance, mydeposits, Client Money Protect and other products.
Underlying the low proportion of landlords using agents is cost, especially since the fees which now cannot be applied to tenants being shifted to owners instead.
Eddie Hooker, chief executive of Hamilton Fraser, says it’s now up to the agency industry to show its worth to landlords.
“Letting agents must up their game and prove value to their customers, which ultimately is the landlord. Agents need to be transparent with their fees, provide the financial protection to their customers and ensure that they are well educated in the business of lettings” explains Hooker.
“There are some very good agents and these are worth their weight in gold. But unfortunately there are also some very poor agents who hit the headlines, tarnishing the reputation of the entire industry. The skill is in selecting the good agent!” he adds.
Hooker’s advice to landlords is that they should interview agents as they would any other service, and if they choose to self-manage instead they should join a landlord association.
The survey shows:
1. As a landlord, do you use a letting agent currently? (2,217 votes)
- Yes, fully managed - 27.3%
- Sometimes - 15.2%
- No - 48.3%
- Considering doing so - 9.2%
2. If you are likely to use a letting agent in the next 12 months, or if you currently use one, what is the main reason? (1,337 votes)
- More COVID-19 measures - 26.9%
- Increased Private Rental Sector legislation - 18.5%
- Lack of time - 35.7%
- Distance from property - 19%
3. As a result of the pandemic, are you more or less likely to use a letting agent in the next 12 months? (2,506 votes)
- More likely - 16.8%
- Less likely - 56.7%
- Undecided - 26.6%
“Technology and access to information is also affecting landlords’ use of agents” adds Hooker.
“Letting platforms with fixed fees and self-selecting services are more commonplace now than say, five years ago. They have matured and are far more transparent than ever. There is more choice when it comes to listings and the internet provides more information than ever.
“Traditional high street lettings unfortunately are suffering from increasing costs which has to be passed onto someone, which in most cases is the landlord.”
Hamilton Fraser’s guide to landlords selecting letting agents can be found here.