Landlords, are you having problems with your letting agent?

July 24, 2019

Worried womanOne of the reasons why many landlords join Landlord Law is that they are experiencing major problems with their letting agent.

And although there are many superb agents who do a great job for their landlords – there are also many who do not.  Often it is hard for landlords to tell which is which.

Currently many agents are in a difficult position financially as they have lost the income they formerly had from tenant fees.  So they are looking to earn more from landlords.

Landlords may therefore find that they are being charged more than formerly.  Which could make using an agent less affordable.

These are some of the issues which we learn about from landlords who have joined Landlord Law:

  • Agents failing to properly check tenants resulting in unsuitable tenants going into occupation – and then falling into arrears
  • Agents failing to pay over the rent, or paying this to landlords late
  • Agents failing to do proper or indeed any property inspections – meaning that landlords are not told about problems at their property (which could prove expensive, for example if a minor repair issue becomes a major repair issue due to delays in taking remedial action)
  • Agents suddenly making extra charges which are not provided for in their agency agreement, or insisting that landlords sign new agency agreements so these can be incorporated

There are three ways to deal with this:

  1. Do nothing and just put up with it
  2. Move to another agency, or
  3. Take over the management of the property yourself

1 Doing nothing

This is not recommended. Your property is an important and very expensive asset.  It is essential that it is managed by an agent who you trust to do a good job.

If, for example, unsuitable tenants are being allowed into occupation and property inspections not being carried out – this can end up costing you thousands of pounds in worst case scenarios.

However, before you can do either of the other options (moving to another agency or self managing) you must end your existing agency agreement.

Ending your existing agency agreement

This is often not an easy thing to do.  Agents will not want to lose your business, particularly if you are signed up to a full management service and are paying monthly fees.

The first thing to do is to read your agency agreement.  This will normally have been signed at the time the agency started working for you.

It should set out all the things that they have contracted to do (so you can check to see if they are doing them) and set out how the agency can be terminated.

However agency agreements are often fairly opaque, particularly on termination.  Frequently they also include penalties for early termination or simply say that it is not something that can be done at all while the tenant is in occupation.

The first thing to say is that if your agent is in breach of contract (for something serious), for example if they have contracted to carry out two inspections per year but have failed to do any – this will normally give you the right to cancel the agency agreement anyway.  On the basis of breach of contract.

Otherwise, your rights will often depend on whether you can be classed as a ‘consumer’ or not.  Consumers can usually take advantage of the unfair terms rules which will catch many expensive termination clauses.  Most landlords can be treated as a consumer, but note that this is not possible if you own your property through a limited company.

We have a very detailed ‘ problem letting agent guide‘ to help landlords when they have problems with their agents, which is designed to help landlords in your position.

Landlord Law members will also be able to seek advice via our Members Forum – where we answer members questions.

Assuming you are able to end your current agency, there are two remaining options for you:

The final two options:

2. Moving to another agency

For many people unable to take over the management of the property themselves – this is the only viable option.

However you do not want to jump from the frying pan into the fire!  Here are some tips:

  • Try to use an agent who is ARLA registered, or registered with one of the other agent regulatory bodies such as RICs or SafeAgent.
  • Look for an agency with cheerful and knowledgeable staff, preferably with industry qualifications (such as the ARLA qualifications)
  • Check that the properties that agency deals with are similar to yours
  • Ask to speak to some of their current clients or maybe get a friend to go in as a prospective tenant and see what happens
  • Also, as a general rule, agents who have been around a long time will often have the edge

Landlord Law can help you, as we have guidance including a long article and a checklist you can use when researching agents.

3. Taking over the management yourself

More and more landlords are doing this.  It is considerably cheaper ( see how much you would save here) and you can ensure that things are done properly.

However you do  need to be very careful.  The private rented sector is heavily regulated and there are often  fierce fines for non compliance with the rules.

This is where Landlord Law can help.  We have online guidance and documents which you can use (including plain English style tenancy agreements which are regularly updated) and monthly training webinars to keep you up to date.

You can find out a lot about the help that we can offer by the various pages linked from our Home Page.

However – if self management is not suitable for you – you should not embark upon it.  We have a handy guide here which will take you through all the different things you need to take into account to help you make your decision.

But whatever you do –

Don’t ignore the problem. Do your research and then take action.

Landlords! What should you do if you are unhappy with your letting agent? Check out the guidance on #landlordlaw

Not a Landlord Law member?  Find out more here.
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