Whether you’re seeking to take the hassle out of managing a portfolio or you’re a first-time landlord looking for assistance with the process, using a property management company can be hugely beneficial. Far from complicating the letting process by adding a third party, the right property management company can streamline the whole system, minimising stress and keeping your property what it should be – an investment rather than a full-time job.
It’s not just about easing the workload – there are a number of reasons why you might feel it’s time to hand over the reins. Perhaps you’ve had a bad experience and would prefer your legal and financial dealings with tenants to be handled by professionals. Whatever your reasons, it’s a big decision to let an external business in on your hard-earned investment. So before you allow a property management company to start taking their percentage, here are the questions you need to ask.
What services are included?
Without concrete certainty of what will be the company’s responsibility and what will be yours, you risk exactly the kinds of complications you’re trying to avoid by hiring them – on a much bigger scale. The exact breakdown of services performed will vary from one property management company to another, but will generally include:
- Advertising your property
- Organising and conducting viewings
- Finding and selecting tenants
- Collecting deposits
- Organising referencing and credit checks
- Organising and conducting an inventory
- Preparing the tenancy contract
- Collecting rent and transferring it to your account
- Managing and arranging repairs
- Conducting inspections
- Managing the end of a tenancy and re-letting the property
- Dealing with any legal issues that may arise
How do you screen prospective tenants?
This is an important question for two reasons – firstly, it allows you to ensure that all procedures such as the legally required ‘right to rent’ check, full referencing and reliable credit checks are being followed. However, more broadly it’s also a chance to glean the backgrounds and occupations of some of their current tenants, and decide whether these tally with what you’re looking for.
How many properties do you currently manage?
Asking this allows you not only to get an idea of the scale and experience of the company, but to look at its current staffing situation – do their employees and resources seem stretched, and will they be able to do an effective job of managing and closely monitoring your property?
How is rent collected?
It’s crucial to ascertain exactly how rent is being handled – after all, it’s your money and it represents perhaps the biggest responsibility that you’re handing to the company. Make sure it’s being collected in a legitimate, reliable way and will find its way into your bank account promptly.
What Tenancy Deposit Protection (TDP) scheme do you use?
It’s a legal requirement to put deposits into one of three government-approved schemes – Mydeposits, Deposit Protection Service or Tenancy Deposit Scheme – within 30 days, and to give tenants a copy of the certificate. This is one of several legal requirements that you should ensure the property management company will fulfil. The others are providing an Energy Performance Certificate (EPC) and conducting a full fire and gas safety assessment.
What insurance cover do you have?
It’s always worth protecting yourself against legal and financial difficulties with adequate landlord insurance, but make sure the company you’re handing responsibility to is properly and comprehensively covered with public liability insurance as well.
What qualifications do you have?
This is one of the most important questions you can ask a property management company. Making sure that they are a member of the Association of Residential Letting Agents (ARLA) will give an indication of quality and legitimacy – but the most reliable qualification of all is recommendation. Speak to other landlords who have dealt with the company and find out, in detail, their honest opinions and experiences before you commit.