A PropTech entrepreneur is advising landlords worried about red tape to use letting agents.
Neil Cobbold, managing director of rental payment service PayProp UK, says currently planned reforms to the private rental sector are just the tip of the iceberg.
“No matter which party wins the next election, reforming the private rental sector will be high on their agenda. Proposals to reform the PRS and introduce new rules and regulations cover everything from energy efficiency to tax returns to anti-money laundering measures” he says.
“Inevitably, landlords are going to need support complying with an ever-growing range of new measures. Using professional letting agents who routinely ensure compliance across their fully-managed portfolio is the obvious solution for landlords who can’t commit to managing their rental properties full time. The risk from non-compliance is great, ranging from hefty fines to banning orders.“
The long-awaited Renters’ Reform Bill is due to be introduced in Parliament later this year and government leaks suggest it will confirm the removal of Section 21 eviction powers, improved grounds for possession under Section 8, a change from assured shorthold tenancies and the creation of a Property Ombudsman to which every landlord will have to be signed up.
Meanwhile Minimum Energy Efficiency Standards - or MEES - are also to be introduced by the Department of Business, Energy and Industrial Strategy. Currently, all rental properties have to achieve an Energy Performance Certificate rating of at least Band E but there are new proposals are for this to be upgraded to a C.
The timetable is still unclear but it has been understood that it could - but not necessarily will - be imposed on all new tenancies as early as 2025.
In addition, Cobbold says there are already many compliance regulations that landlords must adhere to including 29 that cover health and safety alone.
Alongside the government’s reform programme in England a growing number of local authorities have introduced licensing schemes, while in Scotland there is both a rent cap and eviction ban imposed on private rental sector landlords.
Cobbold adds: “Increasing regulation in the PRS is nothing new, but the volume of upcoming changes means there has never been a better time for landlords to seek out partnerships to help them navigate the new landscape.
“The future is bright for the sector and property ownership will continue to be a sound investment which provides a regular income as well as capital growth. Nevertheless, it’s become much less viable to manage that investment passively.
“Letting agents and landlords make a perfect match. The agents have the professional and managerial expertise to get the optimal return from the landlords’ valuable assets, ensure their tenants have a great rental experience and protect them from the penalties of non-compliance.”
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Whilst they can be of use I have a well known agent who is dreadful. They claim to be all heart but they certainly are not!
Sure they help with compliance. But they didn’t complete the initial paperwork properly that stopped me from issuing a S21. They need a kick up the **** to get them to address the issues even though my solicitor says there are issues they say it’s all fine. They don’t take responsibility for anything just collect their fees which they don’t want to stop. They also refused to refund the tenant an overpayment that put me in contravention of the Tenant Fee Act. Against stopping a S21. Thankfully I have the tenants’ bank details and refunded it there.
They also issue rip of quotes. About £12k to re-roof the flat roof of a kitchen. £2,500 to change the kitchen floor? Just some examples.
Booking in the gas inspection. Leaving it right up until the day before it expires despite me chasing by phone and email every other day for 2 weeks telling them to book in a date in writing in case access is not gained so I can prove it. They don’t take any responsibility. But they can break in an do if for safety reasons! A locksmith? Their attendance? Who will pay for that with tenants on benefits living there? Another fat bill from them too! F*****g idiots.
I have found it’s better to do it all yourself. I do as much chasing and worrying if not more with an agent than I would without. I also have to arrange builders for most of the bigger stuff due to rip of quotes.
All they do is taken messages from the tenants really for their 8%. Total waste of money. They just postbox stuff.
I would also have a better direct relationship with my tenants and perhaps things would also be better between us.
Nick your first sentence says it all, ''a well known agent'', these are the exact agents to be avoided at all costs, you are just a number to them, they employ wet behind the ears boys and girls on minimum wage to '' manage ??'' your property for you. The agents to use are the local independents who are also landlords them selves with experience, experience being the key word here, they can have all the qualifications, degrees, and all that tat, but without practical experience they are as much use as a chocolate tea pot
You are so right Nick; dealing directly with the tenants as soon as a problem arises stops trouble.
I handle everything myself with the cooperation of my tenants. They know that if there is any issue that I will respond within thirty minutes and will arrange for a repair or replacement of anything within the hour. My costs are very low, and I receive presents from my tenants.
Andrew, I agree. We have spoken before and you have a good service. Personally I go down the smaller independent routes now. For example with my car also. The main agents charge more and don't actually carry out all of the required works. But they do provide the main agent stamp...There's no valuable stamp with a letting agent.
With letting you can be lucky with a good agent. But as you say "wet behind the ears". I also deal with agents now only since 2021 through my job in construction. They just coordinate and usually not very well. Problem comes in. Fire off the enquiry to the bill payer for approval to send the builder. They get the quote and send it to you. I don't think they even bother to read it.
Ellie, I think my agent's poor service has aggravated things with the tenant. I t would be far easier just to cut them out. Saving on their fees every month I can afford to be ripped off more by a builder too and still be in the same position. I see no value. I'll just do it myself. Especially the initial paperwork. I was so lucky I paid the tenant for their own ex criminal mould surveyor from Tottenham who I did not authorise. He causes a lot of problems telling the tenant windows need changing every 10 years etc. I refunded her to help maintain the relationship. But in hindsight it was the best £80 I ever spend being able to refund directly because my hartless agent was blocking things!
As a small local independent agent we provide a bespoke service second to none for our clients - We are RICS regulated (very unusual) as well as ARLA and ANEA qualified. We treat every property as our own and unlike most agents - including other local independents we dont charge our contractors a commission for giving them the work. We are clear and transparent - Agents like us are out there but its up to Landlords to investigate. We are worth our fees BUT.....
Many Landlords will look for the "cheapest" agent - forgetting to include all the "extras" like hidden commission from contractors - Pay peanuts and you get monkeys!
It does sound as though your agent made things worse. I have insurance for many things. I also use mybuilder to get multiple quotes for a job. British Gas/AXA now cover roof work, window glass, locks and pests. I feel a third party would make me worry more. Dealing with an issue quickly puts my mind at rest.
Another Agent with self interest carving out a business for himself.
He is right of course many of us will need to employ someone to deal with all the red tape they deliberately invented.
Its nothing whatsoever to do with Renting, we will still have to run the Business as usual while they play with Computers which is what they are all about.
So don’t expect them to do anything apart from admin.
No doubt it will put further pressure on Rents and with Government blessing all that lovely VAT.
Nick, I know exactly what you are saying about repairs when third parties get involved the price rocket.
I have a Flat in a small Block of 10 part 2 @ part 3 storey more like Terrace housing.
There was some remedial work required like, facia’s, guttering a few tiles to be replaced.
I offered to to do it £3 / 4k max,
no they need official-dum meetings, surveyor, multiple estimates, refer to Memorandum of Company Articles etc,
OK the Scaffolding went up for months job dragged on & claiming many extra’s.
They didn’t even know the difference between an estimate and a quote, but could they talk and write.
Anyway it ended up £22’000.of which I had to pay my share.
Yes flats are a problem. I avoid them for this reason. I work in construction and the tenants on one block haven't had much maintenance done in 20 years on their new build block. They obviously pay a charge but there was not enough so they all had to chip in £10k last year. Went down like a lead balloon. Costs can ramp up. I have just done an estimate for a client in a block in East London. £350k. But that will cause a massive problem as it's a lot of money and they can't see the value.
I am however getting my own 2 storey gutters and fascias done on my 3 bed semi. Just been quoted £1,700 including VAT. That's about right I think. They are using a tower rather than scaffolding.
I'm not totally familiar with the process but you may legally have had to go through the Section 20 process. My friend was a landlord and he owned in a council block. They charged horrendous costs so he's now sold up.
I always try to find a repairman/roofer/plasterer etc. who will do the work himself. I don't like dealing with a builder who is going to give the work to someone else. You end up paying hundreds of pounds more if one of the builders is acting like an agent.
Sometimes it can be better to pay by the day, and buy the materials yourself.
I thought I overpaid when I had the fascia boards replaced all along a three storey house for £250 including the materials. The work didn't take long, but I was only paying the man who actually did the job.
If I can do the work myself, I do it myself, but there are limits.
What year was that Ellie? £250? What part of the country? You can't get someone out of bed for that? I have just had a quote for £1,680 incl VAT in London. That's including new gutters.
Hi Nick,
I paid £250 in London Zone 2 for fascia replacement about eighteen months ago. That was for materials and labour.
I advertised the job on Mybuilder and had a number of quotes around that figure.
I had a quote for gutter replacement, also in a three storey house in Zone 2 for £300, also from Mybuilder. That was for materials and labour.
I advise waiting for five quotes before giving the job to anyone, and not all roofers are great on there. It is pot luck to an extent.
Most important not to give the job to somebody who is just going to stand there while they get one of their associates to do the job for much less money. Much better to deal directly with somebody who is going to do the job themselves - try to avoid introducing third parties.
Mybuilder also gives you the option to take out insurance on the job before it starts. I think you pay about 10% of the agreed price. This helps if there is an issue with the work that has been carried out.
Please don't blame me if the job doesn't work out.
Ellie,
Thank you. I wouldn't ever look to blame you!
Many thanks
Ellie, I've used My Builder, few yrs ago I need a roofer, when the guy turned up he was a guy I knew from 40 yrs ago, now doing it with his sons and grandsons, I now contact him direct now if I need any roof work done
Thanks Nick. It is not easy dealing with roofers. They can be less than honest and very expensive indeed. They can want a £1000 for an hour's work with one guy taking the bulk of that money and paying his worker a pittance. Check the roofer's feedback before engaging him - they should have plenty of positive feedback.
Andrew that is great that you have somebody whom you know and trust who will deal with roofing problems. That makes a huge difference. In my case, where the builders I am dealing with are complete strangers, I don't contact them again outside Mybuilder for any more jobs which arise. Dealing with them through Mybuilder does provide a bit of a safeguard - they are concerned about Feedback and the insurance system which operates there.
If you are going to rent property then best to keep yourself up to date with everything, and join a landlords association. I found when I had an agent I was managing the properties and the agent as well, so it was more work not less.
Why is this site being used to advertise!
Yeah another 'unknown' who has a big opinion who just want to advertise!
Great advertising for agents. I doubt there is an AST out there which cannot be made worse by the intervention of a 3rd party who has no ‘ skin in the game’, you’re a number on their balance sheet.
The trouble wirhletting agents is they don't care how much a repair will cost and don't shop around for you. They simply use their 'in house' contractors, deduct the fee from your rent. Some even charge you for managing the repair..... What are we paying our fees for? I won't be re-letting any of my properties and currently manage them myself.
MY ADVICE READ UP TENANCY ACTS,, SIGN UP TO NEWS LETTERS, AND THEN DIY, it its easy its not rocket science.
NO AGENT LITTLE BOY JUST OUT OF SCHOOL WILL BE BETTER THEN YOU
Agents need to be managed and action overseen. Landlords need to be on top of all regulations etc. Having an agent is not an excuse for ignorance or their errors. When considering an agent, understand what you pay them. It's often a minimal fee and your unlikely to get a good service because they rely on economies of scale. Low pay, too many rentals and inexperienced staff. As a landlord, it is so important to be ontop of your game!
a change from assured shorthold tenancies ....ominous
I have enough to do managing properties without having to manage an agent as well. Occasionally I've given them a try but they don't follow my instructions and insist on doing things their own way. Last time they managed one viewing of my student HMO in six months while I was getting personal recommendations from former tenants that the agent got grumpy about and refused to follow up on. I got no feedback at all from the one viewing they did do. If that's an example of how they manage my business, no thank you I'd rather be in control myself.
This is my experience. Doing it their own way. No customer service.
I also had a mains water leak. Got them to get a quote towards the end of the week. Instructed is on Friday. Told them to tell the plumber to sort it on Friday / Saturday. Got his details on the Friday too. No confirmation from the agent. Called the plumber myself and of course he had no instruction. It's me chasing the tradesman and the agent. All of the individuals there are total idiots.
Amazing how many people write articles telling us, experienced landlords, how to manage our businesses. But it's always just a way to advertise.
In another capacity, I deal with a National managing agent who charges trades persons 16% of each invoice. Inevitably, their landlords end up paying this. When the invoice is, say £2-3K, 16% represents a lot of money for very little work.
On the odd occasion that my agent instructs a tradesman on my behalf they do normally give me a price first and I pay the tradesman directly , it's the big agents that pull this one
Incidentally, another one 'sale agreed' last week. Regretfully.
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