The UK rental market has grown rapidly in recent years, increasing from 2.8 million households privately renting in 2007 to 5.1 million in 2019. Meanwhile, the operational complexity of running a compliant rental property has grown significantly more complicated, and the cost of regulatory non-compliance is now higher than ever.
Understandably, more and more landlords are choosing a property management service to look after their property on a day-to-day basis. There has been a significant rise in uptake of property management services in the last couple of years, with new customers including overseas landlords, individuals wanting to be covered legally, and people who simply don’t want the hassle of managing a property.
In the below article, we explore the benefits of using a property management service and why you should consider outsourcing property management to a professional (and Home Made specifically).
Why use property management services?
Maintaining a property and looking after your tenants can be a full-time job. You need to make sure your property is well maintained and ready for a tenancy, find tenants before you end up with a costly void period, and deal with the pressure of sorting out emergency repairs and responding to tenants’ requests.
Add to that rent collection, chasing arrears, and keeping up to date with your compliance obligations under an increasingly complex regulatory framework and you’ve got yourself a whole heap of stress (and potential legal liability) that you don’t need.
Imagine this (not at all uncommon) scenario: it's 8:30pm on a Friday night in the dead of winter, and you receive a call from your tenants to let you know that their boiler has completely stopped working and that it needs to be fixed as a matter of urgency.
Instead of enjoying your evening and weekend after a long week at your full-time job, you now need to spend several hours arranging emergency repairs - including finding a properly certified contractor at the best price, keeping the tenants updated, following up with the contractor to make sure they have all the information they need and turn up on time, and following up after the job is finished.
Now imagine coordinating all over the above from a different time zone, 8-12 hours ahead or behind UK time, while your freezing tenants grow increasingly agitated about the situation they find themselves in.
It's anxiety and hassle that you can happily live without!
What are the benefits of property management?
Primarily, having your property professionally managed offers peace of mind. Many of today’s landlords have full-time jobs or live overseas in a different time zone, making it impractical to fully manage their rental properties (as you can see in our previous example).
Additionally, an end-to-end property management service will collect the rent for you, chase tenants for unpaid rent (where required), assist with regaining vacant possession of your property and, arguably most importantly, be fully compliant with rental housing rules and regulations.
A study shows that 52% of UK landlords aren’t aware of their legal obligations - the dos and the don’ts - when renting out a property. Do you know what selective licensing is? How often you need to renew a gas safety certificate? What you need to do to comply with Legionella health and safety regulations? If you don't, you're not alone - it's a lot to keep up with. A professional property manager will keep track of this for you, making sure that your rental property is safe and that you are protected from legal liability.
Finally, the property management service will also handle necessary repairs, including coordinating access for maintenance contractors, find the best person from the job from an extensive network of trusted suppliers, negotiating invoices, and keeping tenants in the loop throughout, with a significant time-cost benefit for landlords (most tenants are not willing to take a day off work to provide access to contractors).
Together with your dedicated account manager, you can decide how you want your property managed – do you wish to be informed about every call from your tenants, or just when required maintenance will exceed a certain amount? This can be tailored to your individual requirements, so you feel comfortable and in control without having to give up too much of your limited free time.
Choosing the right property manager
Choosing a good property management service in London can be a challenge. Landlords need to take into consideration several aspects and carefully pick the service that fits their needs.
Here are our top tips for find the right property management service.
Good reviews say a lot about how a company treats its customers, and offer a reflection of its work ethic.
The average price of full management services in 2020 was a staggering 19.32% plus VAT! Shop around to see what’s out there – paying more doesn’t always get you better service! Here at Home Made, we charge just 4% plus VAT for a full management service that delivers a better customer journey than landlords will find at a traditional letting agent. Molly, our strategic projects lead, has written about how our property management team spends its time, so you can learn more about what to expect for your money and see that there is no compromise on quality of service.
It’s important for you know what you’re going to pay for, when and why. According to a Competition & Markets Authority study on the property management market, 46% of landlords stated that hidden fees and lack of transparency are their main issue when it comes to property management providers. Read through all of the their pricing literature carefully and look for the extra fees hidden in the small print. Our guide to lettings fees will help you to know what to look out for.
Don’t be afraid to ask difficult questions
It’s important you feel that the company you choose is going to take care of your home as you would take care of it yourself, and always has your best interests at heart. Some helpful questions include:
- Do they take a float? If yes, how much?
- Do they add margins when instructing their contractors (effectively making profit from every maintenance visit)?
- Will they make every effort to contact you about required maintenance?
- Will they attempt to resolve minor maintenance issues directly with the tenants before calling in a professional contractor (and spending your money).
- Does their fee include all the tenancy administration key to securing the tenancy (contracting, Right to Rent, tenant referencing, deposit registration etc) or are there extra charges for documentation.
If you can find an affordable property management service that you can trust, it's well worth handing over your asset to the capable hands of a professional. You will gain peace of mind, be covered legally, save loads of time and, most importantly, have happy tenants who want to stay for the long term!
~ Article updated March 2021
Home Made offers full property management services for a monthly charge of 4% plus VAT (deductible from the monthly rent). You can learn more about our service here. If you're ready to get started, book in your free valuation using our quick and easy online form.
If you would like to speak with us about your property needs, contact us via our website to find out how we can help.
If you would like to discuss property management services in London, the industry and how we could help, get in touch with us.