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Hi all, I am considering using an online agent to manage my rentals.Normally it’s quite common for someone to use an agent to find a tenant and then they manage the property themselves, however I am looking to do the opposite. I am happy doing the tenant find myself, as I actually prefer choosing and meeting the tenants myself, this would purely be for management during the tenancy (inspections, if something goes wrong, needs fixing, etc). I have come across a few online agents that do manage (No Agent, Property management people, etc) however I am still unsure of how they can practically manage a property remotely. 1. Let’s say a tenant reports a leak. What is the process? Does the tenant contact the online agent, who then sends a tradesmen round to fix the issue?
2. Also how do they do inspections?It would be good to hear from someone who has used these services. The online agents seem very cheap for full management so just interested to see if there is a catch.
I have baulked at using on-line agents because I believe that a local person with feet on the ground near the property is very important.My agents know my properties and tenants personally - they have met both! 1. Let’s say a tenant reports a leak. What is the process? Does the tenant contact the online agent, who then sends a tradesmen round to fix the issue?They have a network of tradespeople around the country who they can call on.
2. Also how do they do inspections?They send an inventory clerk or use Viewber's outsourced viewing service - which is also available to landlords. See - 10 instances for outsourced property viewingsMy overall view is that there are a great many of these on-line agents, all cutting costs and being subsidised by crowdfunding, and it's a race to the bottom.I suspect most of them will go bust and only two or three main players will be able to sustain it by volume. The levels of service and quality may vary considerably, so look for independent third party reviews as well.
Vanessa Warwick Landlord and Co-Founder of PropertyTribes.com **If you have got value from Property Tribes, find out how you can support it in remaining a free to use community resource**
Hi Vanessa, thanks for your reply.
I can definitely see the benefit of a local agent but I have stayed away from them mainly due to the fee they charge.
My properties give me a total monthly income of around 4k. Based on a 10-15% management fee, I would be looking around around £400-600 a month in agency fees. Let's say £6k a year. I can't justify spending that amount on an agent. Imagine this, (hypothetical of course) I could not do any inspections for 3 years, then after 3 years, spend that £18k (£6k x 3 years) on a full refurb, re-let and potentially get more rent.
I appreciate there are good letting agents out there that do earn their keep, I just haven't come across any. I think it's true for anything that unless you are paying premium prices (and even then), an agent will never look after your assets as well as you would. At least with an online agent, you are paying a lot less, your expectations are lower = less disappoint. Unless a local agent came highly recommended, it is not something I can justify.
Your last paragraph is interesting. I do agree with you that many will come and go, but I do believe online agent is the future and like you say there will be a couple that will succeed and they will be the future, the Airbnb/Uber/Deliveroo of lettings!
I am certain that my agents look after my properties better than I could. One looks after a property over 200 miles away. The other has over 40 years experience.
Anyway I'd rather spend my time doing other things.
I feel that as a Professional Landlord cutting corners in Management is a no no. It may end up costing more in the long run using an online Agent. In order to manage a property correctly and to have contented Tenants you need to spend money if you cannot manage the property Yourself. After all, you are providing a service as well as investing for your own financial gain. If you don't manage a property correctly, the bad reputation will have an effect on your business. If you have contented Tenants, I feel it goes a long way in building your reputation as a Landlord.
Good local Agents are out there but as always, it is all about communication. Let them know what you expect and how often your property should be inspected requesting a copy of the report with photos for every visit; give the Agent some feedback based on the report. Give then a 'float' for maintenance but ask them to call you if they need to spend over a certain amount.
The catch with online Agents is that they probably will not be able to manage your property to your expectations. If they do then it will obviously cost you more.
Woah cutting corners? Not trying to cut corners at all, you imply that by using an online agent is cutting corners? This is why I am trying to find out people's experiences if it is worth doing. If I can get close to the level of service a local estate agent with an online agent, then surely it is a no-brainer. The claims on these online websites state just that, so I am interested to see if they actually walk the walk.
I fully agree you cannot get a 5 star service for free, however at what point do you draw the line. Spending £6k a year on management which doesn't include actual repair costs (should any arise) is a lot to me. But then again I am used to paying zero, so it's all individual perspective.
I think it comes down to location and how far one is away from their properties. If I was hours away from my properties, then yes, spending £6k for reliable management may be a necessary cost. But I am only an hour away, and whilst it's not down the road (like it used to be before I moved home), I'd rather self-manage then pay £6k a year.
Apologies, cutting corners may not be the right term for wanting to save money. I have been self managing my properties for the past 25 years and wouldn't have it any other way. Between myself and our own maintenance team we manage everything very well. For me, it was never about saving money. I tried Agents when I first started buying but wasn't happy with the level of service. At the end of the day, us, as HMO Landlords are fully responsible for all eventualities or potential shortfalls from Agents. The buck stops with us. I know a lot of Landlords that are happy with local Agents but I personally feel that with large HMOs the Landlords must have full control to ensure they are not left wide open; this could mean self managing or meeting with the Agent regularly at the property on their inspection days (if possible) to discuss any concerns.
If you are only an hour away why not just manage them Yourself. I really do feel that you won't get the service you hope for from an online Agent.
If you look at it commercially, an online Agent cannot really manage your property successfully from afar. If they use a local Agent/Professional etc, the local Agent may give them a better rate than you going direct to the local Agent as they could be putting a lot of business their way. Now the local Agent has to carry out the work for less profit to a degree which will never be a good thing for the Landlord.
I hope that whichever route you decide that you manage to meet all of your expectations.
Interesting questions, and something we're looking into at the moment. We'd like to eventually become as hands free as possible as we go into retirement.
The key seems to be to use an online agent who has local agents dotted around the country. Full management can only work well if someone local to the property is available for visits as needed, ie viewings, lost keys, check in/out, etc. This would be crucial to manage an HMO, which I understand most agents won't touch. The only company we've found so far is Lettingsupermarket who charge 5%. Haven't done much research into them yet but intend to. Would be interested to hear if anyone has used them, or any another similar agents.
Yes I have heard from them although I hadn't looked at what they offer.
From reading their website, it seems they are online only, do not have any high street branches, and use inventory clerks to check in on the property.
They charge half the price of what a normal agent wold charge... interesting, I may look into this further. Thanks for the recommendation.
Have you spoken to local agents if they would reduce their fees for multiple properties?
Try suggesting to some local ones 5% for all your properties and see what they say.
I set up and manage all my properties . I like to know whats going on and make sure that any probs are sorted out for the tenants as some as possible . But once everything is set up I send in my inventory clerk for regular inspections . Inventory clerk already knows the property as they have carried out initial inventory and I also get an inspection report with any pics.