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Advice on where to start - New Landlord

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Author Topic: Advice on where to start - New Landlord  (Read 148 times)
Newbie
Posts: 5

I like property

« on: October 09, 2021, 12:34:34 PM »

My Sister and I completed on a purchase of a rather underwhelming 2 bedroom flat over a vacant shop last week.  The reasons why are perhaps not terribly relevant, but suffice it to say the previous owner, a mutual friend of ours has now, after over a year of trying, moved in to a much more suitable/accessible bungalow. 

For the time being my sister and I intend renting out the property - we think once the situation downstairs is resolved - it will most likely end up being converted to residential as it has been empty for years, our flat will be much more salable.  It is also possible, if things work out well with renting, we may keep it on - the returns on cash are so poor.  We have been assured by a couple of estate agents that there will be no issue getting tenants and indeed the even more undesirable property next door is never vacant for long. 

I am retired and the tax free cash from my SIPP has funded my half of the property so there is no mortgage to worry about.  My sister is in a similar position.

My questions to the forum are about the best way to proceed.  Do we need to use an agent?  Or as we are both local can we self manage?   Apart from the obvious gas safety certificate what else do we have to do, to ready the property for letting?  If we don't use an agent, then what is the best way to advertise the property?   What are the pitfalls in selecting a good tenant..
Newbie
Posts: 5

I like property

« Reply #1 on: October 09, 2021, 04:00:11 PM »

Having done a bit more research we have decided to use a property agent to find the tenant at least.  I don't think either of us is hardnosed enough to withstand a sob story and the checks required look quite involved.  I have also worked out we will need an electrical safety check as well as the gas one.  Does anyone know if the smoke alarms need to be mains linked? The ones there are just battery operated..
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Posts: 4299

Abuse Officer

« Reply #2 on: October 09, 2021, 05:16:41 PM »

You don't exactly purchase a property by accident... so you're not really an accidental Landlord. You are one who went into this with their eyes-open (wide open). So, just like you must have done some research throughout the purchase of this, and other, properties, this is what you need to do now. Starting out with an Agent is not the worst idea you've had... but just be careful... by that I mean - be careful of the Agent. They are as slippery as any Tenant could ever be. They often will only act in their own best interests. They will try to shaft you for fee after fee after fee. If they do management for you (your comment makes this seem unlikely, but you never know) they will inflate prices and take kickbacks. You will be a small-fry on their books... so they'll spend all their time and effort keeping their big fish clean (mental images of remora come to mind).

So... my biggest hints to avoid the biggest pitfalls... aim to manage the Deposit yourself, aim to get your certificates yourself, ensure you read the Terms of Business an Agent asks you to sign and don't do it blindly, try to find out something about the Tenant (while you can't handle a sob-story, the Agent won't care - they'll just get anyone in, even if it's for 6 months - because then it's another Tenant Find set of fees, right?), make sure the Right to Rent checks are done... the smoke alarms don't need to be mains, but you might ease your worries if you installed a new set with a 10 year lifespan. If you are local and you can deal with people on a reasonable level then I think it is a missed opportunity to hand the job over to an Agent... but that's just me, I suppose.
Newbie
Posts: 5

I like property

« Reply #3 on: October 09, 2021, 07:26:03 PM »

Thanks for that Hippogriff - You are right not entirely accidental - just not planned much in advance ;D

It looks like we could make about 5% return, if I have got my sums right + the capital should be OK if we can avoid a massage parlor or off-licence going in downstairs- Should be safe as there is a primary school opposite!

Interesting what you say about Agents - I assumed they would try and get us a good tenant or we definitely wont use them again.. do they try and tie you in for future tenants as well..

If we don't use an agent would signing up with someone like PIMS https://www.pims.co.uk/ be useful as they do credit checking and give you template agreements etc.or are there better places to start?

Jr. Member
Posts: 59

Landlord - always learning

« Reply #4 on: October 09, 2021, 11:17:47 PM »

If we don't use an agent would signing up with someone like PIMS https://www.pims.co.uk/ be useful as they do credit checking and give you template agreements etc.or are there better places to start?

I ditched agents on two properties and have used OpenRent https://www.openrent.co.uk/ to advertise, help with the tenant find process, set up the tenancy agreement, and protect the deposit for two rentals so far.

I found the process very straightforward and OpenRent's fees are incredibly low.

There's lots of helpful advice on their website.

If you are willing to vet your potential tenants and do the viewings, then OpenRent is a good way to go IMO.
Newbie
Posts: 5

I like property

« Reply #5 on: October 10, 2021, 09:46:27 AM »

Yes I just came across OpenRent and was about to ask about them - looks like a good option..
Global Moderator
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« Reply #6 on: October 10, 2021, 09:54:25 AM »

 I have managed my properties for a number of years.However,I continue to use a local one-man agent to find tenant, set up lease,do the checks,provide all documents and protect deposit.For this he charges a one-off fee of 50% first month's rent.When you have full management agents will usually impose a penalty if you drop them while a tenant they arranged is still there. These can be eye-watering,so do check what you are signing.
Another thing to be aware is that if work is needed,they will use someone on their list of trades,getting  commission of 10-15%. An agent I used once told the workmen to pad out the bill, rich landlord (I wish) Try to get your own few trusted people,unless you are very handy yourself.
I think the most important advice is never let to friends or relatives,and listen to that gut instinct if you suspect someone is a wrong 'un.

 
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« Reply #7 on: October 11, 2021, 09:57:57 AM »

There is a lot of value - I think - in doing viewings yourself. Of course, you haven't described the property in question here as being very salubrious... but I'm going to assume it's still something you care about. While I 'employ' an online Agent (for me it's uPad) to list the property... I, basically, do the rest. One of the things that takes time but I've always found useful is the viewings where you get a chance to assess people yourself. This is how I've ended in the position of letting to people with CCJs... my view is that a CCJ doesn't matter if they're open and up-front about it and it's explained and it's being serviced... but for others it might be a red line. As yet I've not been burned by that approach. Likewise, I've ran for the hills with some prospective Tenants who appeared financially stable but openly pernickety and felt high-maintenance.

A high street Agent is not likely to do this for you. For them viewings = time and money = profit. They want to do as few viewings as possible and get your property "off their books" (or on their books, whichever is right) and the commission rolling-in if there's a full management agreement. They don't care that much about personal vibes... and, if you think about it, it might be kinda illegal anyway for them to have views - so they have to do it by the book, checkboxes... multiples of rent vs. income and credit history... references etc.. An Agent only partially wants what you want.
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« Reply #8 on: October 11, 2021, 11:56:36 AM »

I agree that it is a good idea to meet with people where possible.I have had greedy agents land me with the most awful rogues.The current agent is very local,lives yards away from me,savvy but not too hard-nosed.If he has doubts he voices them to me,and he's turned away more people than he has put forward over the several years I have used him. He is absolutely not typical though.
Newbie
Posts: 5

I like property

« Reply #9 on: October 11, 2021, 08:05:24 PM »

So, I have definitely cooled on the idea of using a high street estate agent in any form - OpenRent seem a good way forward - Many thanks for your help  :)
« Last Edit: October 11, 2021, 08:08:24 PM by Accidental LL »
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