Tag Archives: Professional Management

26Apr 2011

Property Landlord advice: Poor condition of Private Property to rent raises more causes for concern.

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By Steve Roulstone

 As this report shows, it is still not difficult to find evidence of poor standards in the Private Rental sector. Yet again the Industry as a whole suffers from the performance of one individual as we suffer by reflection, although I note there is no mention of an agent in this case. The frustration for me as a Letting Agent is that we are available to give the kind of advice that would ensure standards could be upheld should we be asked, and of course listened too!

Property shortages do not help.

As I am only too aware, during periods when available housing to rent is at a shortage the limited choice means that many will not have the options they would appreciate when choosing a property to live in. I have just experienced something similar when looking for a Country property and only because I happened to look very early one day and by an incredible piece of luck (the person I asked for directions was part of the family who owned the property; access gained no more than thirty minutes later!) did we manage to get first ‘dibs’ on a Farmhouse close to where we work. But for those who are not so lucky, they can be forced to take the best of what is left and of course conscious decisions cannot form part of the process.

Professional links.

Just like the new Kitemark being pushed by our industry at present, professional links for both Landlords and Agents would allow people to have a considered decision to make; lack of available property removes that decision in so many cases. Not that I would ever discourage anybody from forging such links, as the person reports from the local Landlords association, poor Landlords do exist and the more we bang the drum about professionalism the better we will be heard. So whenever possible Tenants should look for some kind of link with a body who promote good standards to give them some re-assurance about the lease they are entering in to and the future maintenance of the property they wish to call home for the next few years.

Advice is needed.

As the property programmes show, good advice is not always listened too, but when it comes to basic standards, unless a Landlord has asked, or been offered advice by somebody within the profession, then there remains nothing more that can be done to say if the Landlord then goes on to look after the property in question and therefore the Tenants who will presumably be paying the Landlords Mortgage or giving them a good living, or if they take the opposite view and look at the situation purely from a financial standpoint, which is surely what causes the majority of problems for Tenants and just will not spend on basic housing standards that most of us would view as second nature. (and of course is covered by Government legislation)

Another call for registration?    

The result (indeed the National picture) is more proof of the need for some form of legislation to put a stop to the ease with which people can become Landlords without even asking one simple basic question about the Tenants rights, even though they are going to have such an influence on the standard of the Tenants life for the duration of the agreement. At present the need is becoming greater as Landlords, being no different than anybody else protecting their income at the moment, look for ways of cutting expenditure where possible. But when that decision effects the life of others, that’s when we should be able to turn  to those who legislate the Country for support, but hopefully the comment from the Housing Minister Grant Sharps, that the situation was under review in the medium turn suggests that the banging is beginning to get through!

21Apr 2011

Current Property News: TDS Figures from DPS seem impressive but do not give the whole picture

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By Steve Roulstone

The Deposit Protection Scheme has recently had some figures released in a recent press article and on the face of what they state, they do look impressive. Indeed, I would say that the scheme has been vindicated as one of the best available to Agents and Landlords as they approach ¾ million active deposits. I could not help but notice though a couple of what I believe to be very pertinent facts behind the figures, which in no way reflect on DPS as an organisation, but what they do show is that the Industry is still far from committing itself 100% behind the legislation.

Where have they been?

Firstly and separated from the main section if facts and figures  in the report is the somewhat surprising fact that as a Company, DPS are still registering around 200 new Landlords a day. This is allowing for working days alone, a rate of around 10,000 a year. Now my mind immediately asked where they have been until now, because even allowing for cross registration when Landlords decide to change or indeed new Landlords coming to the system for the first time, this figure shows a large percentage of Landlords were outside of the legislation, which do not forget, is now four years old.

Time for teeth?

It would be interesting to see if companies such as DPS, who of course must accept the contact and register the deposit at face value, actually take data about the history of the Tenancy. For those of us who wholeheartedly accept and encompass such legislation, do so with the hope that the legislation will deal with those who do not. Of course I am fully aware of the costs and penalties associated with not registering a deposit, but surely there has to be a time when you have to ask Landlords to prove why deposits for the property concerned were not registered prior to this date and for me four years is long enough for such situations to be questioned!

Landlords found wanting.

The second and more important fact that most Agents would have picked up on will be that two in three adjudications where sole culpability was awarded was awarded against the Landlord. Now what I would like to know and I believe should know, is how many of these cases (3518 in number using the figures quoted) were tenancies in Management and how many were through Agents. I am aware through the cases involving Castle Estates that where the correct paperwork and procedures have been presented, that the Landlord is usually successful, because if we believe that he would not succeed, we would recommend settlement and negotiate with the Tenant rather than go through adjudication in the first case.

Proof is in the figures.

The figures that I believe should be included in this release are those confirming how many unsuccessful Landlords were self managed? And indeed it would be good to see what percentage was managed by unlicensed Agents who are not connected with Industry regulators. (NALS, ARLA, RICS) This is an age old problem and such numbers would indicate how successful the recent legislation introduced by Government has been at changing the face of the Industry. So conversely we would also need to know what percentage were Managed by what I have always referred to as Professional Agents who do believe in running their businesses to the standards set by such bodies. The second half of this request is probably impossible for DPS to judge, but I believe that we would start to see justification of our shout for professional registration for all Agents and Landlords if they were made available – anybody listening?

11Apr 2011

Property Landlord advice: Lettings Sector set to grow on back of stamp duty reforms in buy-to-let market.

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by Nick Strong, MD www.SelectYourFranchise.com

Lettings agent franchise networks are understandably excited about the potential for market growth in the buy to let market sector in 2011.  In the recent budget George Osborne made it easier for large investors to enter the buy-to-let market. 

 The coalition government has identified buy-to-let as a way of solving the housing crises that has been exacerbated by the difficulty of first time buyers accessing funding over the past two years of recession.

 Buy-to-let opportunities have therefore been opened by stamp duty reform.  So much so that Aviva, which has been lobbying for reform for some time is seeking to put together a £1billion fund which could be enough to purchase 5000 buy-to-let properties. This is because stamp duty on the purchase of more than one property will now be calculated by the average value of the properties, not the bulk value, which the industry has campaigned for.

 It is understood that other institutions and pension funds who have eyed the sector are Aegon, Terrace Hill, Legal & General, and LaSalle Investment Management. Property agent CBRE has estimated that institutional investors have allocated £7.5bn for residential property.

 It is thought unlikely that these initiations will want to manage their own property portfolios given the difficulties that the likes of Countrywide experienced when they entered the property market.

 There is clearly the opportunity potential for Letting franchise sector business to grow if large investing corporate decide to distribute their buy-to-let portfolio via agents with significant access to market across the UK.

 Steve Roulstone, MD of Castle Estates said ‘I have been lobbying for changes such as this especially through the pages of this site, for some time now, as I firmly believe that by easing the way for Landlords to start investing again we will start to build confidence in the property market again. Nobody is asking for financial restraints to be removed completely, as nobody sensibly wishes to go through a period of unrestrained growth that could then result, but sensible steps such as easing tax burdens imposed on Landlords can only help’.

07Apr 2011

Letting Agent News: To tweet or not to tweet?

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By Matthew Carter

Lots of letting agents are still questioning whether twitter is right for their business. The primary role of twitter for a letting agent is to connect with their local community, be more accessible to their potential client base, promote their latest properties and generate business leads. I started a twitter account for our business back in 2009, over the years I’ve picked up a few tips that you might find useful:

  • If you’re new to twitter you might want to follow lots of people to start with to inflate your own follower numbers – you follow them they might follow you back – simple (remember the more followers you have the more people there are to see your tweets – potentially).
  • But do your followers care what your business is saying? Possibly not, so after a few weeks start to be picky about who you follow and create you own niche/community this could include existing clients, potential clients, trade press, and competitors (why not keep an eye on them?).   
  • Make the most of lists – I utilise lists in twitter this way you can keep track of how many clients or potential clients are following you
  • Get it on your phone – it can be difficult to tweet when you’re busy, so register your business profile to a mobile twitter App this way you can do it on the move! (You don’t necessarily need an iPhone)
  • Keep it personable – relax a bit, use your tweets to get the more human side of your company or organisation across from time to time
  • Show of your knowledge every now and then – You want your customers to know that you’re a thought leader so, comment on the latest industry news, flex your grey matter – show your customers what you know and why they should chose you  
  • Get your twitter feed on your website (not just a link!) – this can be great for Search Engine Optimisation, the content is constantly changing and you’ll be using keywords in your tweets that could help you float up in the Google rankings     
  • Link twitter to your facebook page, this way any facebook updates go straight out as tweets! (I usually use twitterfeed.com)
  • You can also create a news feed in Google reader and link it to your twitter account, subscribe to stories and keywords that you customer base might find interesting in Google reader – ‘share’ a story and it appears on twitter (again you can use twitterfeed) 
  • Use tiny cc to shorten your links – more space to get across what you want to say! You can also chose the name of the link to make it more appealing 
  • Add a link on your email footers – let your customers and suppliers know that you’re contactable through twitter 
  • Make sure you link to any articles or PR that you might have been mentioned in to help spread the good word and give your PR more longevity (and hopefully more exposure)
  • Get some conversations going, take the time to comment on your clients tweets and strike up a conversation
  • Report the success of twitter – let your board know about twitter, don’t keep them in the dark! Who’s following you? How many referrals from twitter does your website have? How many people follow you? (You might also like twittergrader to keep track of your stats) 

 

29Mar 2011

Current Property News: Letting Agent Kitemark – Yes Please!

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By Steve Roulstone

The National Approved Lettings Scheme (NALS) are to champion a new Kite mark for Letting Agents with compliant CMP (Client Money Protection) and as the owner of the Castle Estates brand, I would like to throw my weight totally behind the scheme and the principals that the scheme promotes. I have long stated through these pages that I firmly believe in and openly support any move towards confirming professionalism in our industry and can only congratulate those behind this move.

Public will benefit.

Every Agent should embrace this scheme, which is free for those who already have CMP. It is now down to every qualifying Agent to sell the system and advise our Landlords that we both embrace it and what the scheme means. In simple terms, every Agent who carries this Kite mark will by definition, protect and insure the Landlords money. It is time for us not to just sell the advantages but also make sure that both our existing and potential Landlords are aware of the implications of NOT being able to display the Kite Mark. It is time we stood loud and proud and waved the flag of Professionalism as often as possible!

Government take note.

But to me this is also an opportunity to say to the Government that as an Industry we believe they made the wrong decision in not following through with registration of Agents as recommended by the Rugg review of 2009. This is another reason why I champion the decision, if the Government will not support us as an Industry through legislation, then as an Industry we must legislate ourselves. I am not suggesting we do not need the Government, because as the report (link above) states, this is not law, but hopefully, sufficient Agents will adopt this opportunity that the Government has to take note and will in time back us with the type of legislation that will once and for all confirm our Industry as Professional.

Why do we need legislation?

As an Industry, like so many others in difficult times, we are offering our services at reduced rates through Competition. I firmly believe that no matter what price we offer our service, they should always be accompanied by the Guarantees offered by CMP and professional membership to bodies such as NALS and ARLA. Such membership does have its costs, which can be significant and along with having qualified staff to carry out the full range of services that a Professional Letting Agency should offer we can quite often find ourselves competing at a disadvantage to Companies that risk the implications of operating without Guarantees for their clients and at a reduced level of service.

Legislation equals Professionalism.

Unfortunately the papers are still full of Offices that have collapsed because of discrepancies in Client accounts (monies held). Confirming the continued need for legislation, especially at a time when so many have been attracted to what is unusually at present, a growing market. Further proof of this is the Financial Increase we are currently paying for continued CMP cover. An increase which comes about purely because of claims made against the scheme. In summary, this Industry is doing something positive to combat the difference to services available, but the Government can make it happen through Law. The Kite Mark is therefore very welcome, but legislation is still needed and as soon as possible please, in the meantime we can show our commitment by joining and letting the public know, why and what difference professional Agents make to this growing industry.

25Mar 2011

Current Property News: Landlord specialist Insurance must be given strong consideration.

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By Steve Roulstone

It is time once again to stress the importance of Landlords Insurance in the rental market, as we approach another year of difficulties in the workplace. This at a time when record numbers of properties are coming to our market sector and in many cases the demand for rental property is outstripping the supply, the risks MUST be understood by Landlords and the added security of such Insurance Policies as far as I am concerned are the minimum requirement for Landlords, especially those who are renting property for the first time.

Nobody can be secure.

I am not alone in promoting the values of such Insurance and the common sense reasoning is there for all to see. With a policy that protects both the rent and covers the costs of evicting a Tenant, at a time when redundancies are growing (This BBC News link will confirm) Letting Agents should be suggesting that all Landlords take such a policy as a matter of course as no Letting Agent can confirm that the Tenant that they source for the property will not be one of those who may suffer this fate themselves.

Solutions do exist.

 

Of course, any professional Agency will have their tried and tested systems to show how arrears are dealt with and dependent upon the situation surrounding the Tenant (who will always be professionally referenced) could negotiate the surrender of the property on the Landlords behalf and of course with the Landlords approval. But with the best will in the world, and with the best of intentions, no Agent can either stop problems occurring or be able to foresee the manner in which Tenants may react to bad news.

Cost is not prohibitive.

 

With six month’s rent and legal expenses covered for as little as £100.00 in some cases, and as a Landlord myself, I can see no reason why this peace of mind policy should not be taken, but it is not just new Landlords that should take advantage of the policy, I believe all Landlords should consider doing so no matter how long they have rented their property. This cost when considered against the risk, whilst proving that the risk being covered is not a common problem (No insurance that covers a cost risk of several thousand pounds if claimed upon on a regular basis could still be available at such a low premium) is at such a low cost that it really should be taken against every property let, because when a Tenant neither pays or moves on it is not only the fact that it is such a costly process to the individual Landlord against the property concerned, I have also witnessed just how upsetting and time consuming it can be to the owner.   

Peace of mind.

 

It is the comfort factor alone, that income and legal expenses are covered that gives Landlords this feeling that at least they do not need to worry as professionals deal with the situation on their behalf. Instead of having to find a solicitor who not only understands property law (Not as common as you would think in the High Street) but have to be involved at every stage of the process themselves in the decision making, the policy ensures that professionals take all of these decisions on your behalf, as they ensure the matter is dealt with as swiftly as possible, simply because they are the ones paying if the matter is not dealt with in this manner, so yes I advice taking out this peace of mind insurance, perhaps the question should not be why, but rather why not?

16Mar 2011

Property Landlord advice: Block Management and Letting Agents (Part 2)

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By Steve Roulstone

There are several areas where having somebody who is qualified to understand the implications of renting leasehold property managing the site is to the advantage of the other Leaseholders and the running of the site (Block Management Company) in general. One of these is the need to ensure that any secondary agreement offered to a Tenant by a Leaseholder carries the requirements of the original lease within it, to ensure many basic stipulations of the site can be upheld.

Upholding the rules          

 

Without such inclusions, (which can be dealt with reasonably easily by anybody who understands the implications) such basic site rules as ‘No Caravans’ or ‘No Commercial Vehicles’ cannot be enforced as the agreement of the lease is with the leaseholder, not their Tenant The Tenant is only answerable to his legal agreement and if the clauses are not included, then the original Leaseholder in allowing the Tenant to break the lease and is the person therefore answerable to the Management Committee.

Ignorance is no excuse.

 

There is no way around this as I have found in my own experience, indeed it was only because one Tenant who parked a caravan on a site we Manage was very understanding, that we managed to have the rule enforced. The Leaseholder and therefore Landlord’s only excuse was lack of knowledge, because his Agent had not taken the time to check, which of course must be the situation up and down the country. But there are many clauses which can fall fowl of this problem, such as pets and of course the biggest problem of all, the permission to sub let in the first place.

Permission to rent.

 

Permission cannot be unreasonably withheld of course for any matter, but if the Leaseholders who live on the site as well as the Freeholder (if not self managed) who’s lease we are discussing here, did not intend the property to be available for rent, then by having a Letting Agent acting as block Managing Agent, whether acting for the Freeholder or the Block management Company (Residents) it is probably in the best interest of all concerned that the rule can be upheld.

Check before signing.

 

So the golden rule is to check before any sub-let is agreed and yet in all of my time as a Letting Agent who operates as a Block Managing Agent as well, I have never once received a phone call to request confirmation of the contents of the Lease or indeed ask if Permission is given on site, from either other agents or Landlords running their own Management. It begs the question just how many ticking time bombs exist out their?

11Mar 2011

Property Landlords advice: Resident Landlord agreements (Part 2)

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By Mike Edwards

The starting point and the fundamental factors in determining whether you are dealing with a Resident Landlord (ResLan) or not is whether the building is largely as originally constructed or has been converted. Or a purpose build block of flats no matter how small. If the latter and the builder/Landlord reserves one of the units to themselves not a problem it can never be a ResLan case. Similarly if the Landlord does not use the property as their main residence then equally it will not be a Reslan case.

What is a RESLAN Tenancy?

For it to be a ResLan tenancy therefore one of two things must happen, but in either case the accommodation must be self-contained even if it is a shared communal access – such as the hallway of a converted house. The 1988 Act says quite specifically that if both Landlord and Tenant live in the same original building and it is not a block of purpose built flats, then the tenant cannot have a 1988 Act tenancy. Therefore if you have a self contained flat upstairs and one downstairs and the landlord lives upstairs and the tenant lives downstairs, the tenant can have a Common Law contractual tenancy, but not an AST because it is Resident Landlord, and that puts it in the excluded category.

Licensor and Licensee.

Next assume a simple house and the tenant has their own bedroom but shares the kitchen (even if meals are not provided). If the Landlord was not living there this would be a Hybrid AST situation like any other sharer. But if the sharer or one of them is the Landlord then this is a typical lodger agreement and only a license will be granted and the wording throughout will be Licensor and Licensee – though in construction it could look very much like a normal tenancy agreement. However that may look like overkill for what is a fairly informal arrangement compared to a full blown tenancy. If the occupier where the Landlord lives in the same building (as originally constructed though possibly converted) shares any of the essential living accommodation (bathroom, kitchen even a lounge) then that occupier does not have exclusivity over all the accommodation and is a licensee and can only be granted a licence and not a tenancy at all. For licences it is generally recommend to use weekly periodic agreements to make it easier to get rid of co-habitees who the Landlord ends up not rubbing along with. Basically if you grant the licence on an initial fixed term and payment period of a week then you are contractually bound and can have complications and longer notice periods.

Notice procedure.

If a weekly licence is granted then a simple letter stating all the necessary detail and dates and giving a week’s notice is all that is required and no Court Order is needed to evict either. If it is a Common Law tenancy (Landlord living in same property and tenant having exclusive accommodation again like the flat example above) then a normal Notice to Quit is used giving a month’s notice. As far as tenant or occupier protection and rights are concerned all occupiers who are licensees or tenants are covered by the Protection From Eviction Act 1977 (PFE) except those living with a resident landlord, where a Court Order is not needed. Hence the weekly licence.

Check PFE status.

If they do because they are a tenant then you will have acted illegally if you evicted them only with a letter giving them a week and then entered their room and put their belongings out on the street. You can do this if they are a licensee and don’t leave at the end of the week’s notice – but you cannot if their status gives them PFE protection meaning you should have given them longer notice (minimum one month) and obtained a Court Order

Link to Res LL Part 1

07Mar 2011

Rental issues: Avoiding Rental Voids can be a problem.

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By Steve Roulstone

The Tenant deposit scheme has on the whole been well received and there is no doubt that it has done exactly what it was meant to do when introduced. Namely, to ensure Tenants and Landlords communicate and negotiate with each other over dilapidations. It has however had other effects which were not foreseen and when Tenants do not act in a reasonable manner, causing a dispute and creating a situation which can add further problems when the next Tenant is due to move in for example, the next day.

New Tenants expect the best.

When any Tenant moves in, they do not expect to be faced with a situation where damage to the carpets, decoration or appliance for example, has to be left until such time as proper negotiations have been undertaken with the leaving Tenant over where responsibility for carrying out repairs should lie! It is not a new problem, but prior to the scheme, we could make an experienced judgement over who created and therefore who should pay for the issue to hand. Now we can no longer do this and according to the TDS procedure, must even take time to gather estimates before getting agreement and starting the work.

Why not avoid the situation.

Avoidance would be the easiest solution, always ensure a week between Tenants, but the reason so many Tenants follow hot on the heels of the last occupier is at the new Tenants request. Most Landlords can see the potential issue and rather than risk upsetting the new Tenant, will agree that a void period has to be accepted between Tenants. Of course as Agents, especially those carrying out the viewings, the ability to change Tenants without any void is difficult to avoid, after all, we are doing the best we can by our Landlords and when the new Tenant states they have to be in sooner rather than later it is difficult to risk them going elsewhere by saying no!

Best advice and best practise.

So our advice to avoid the complaint from the new Tenant, which is bound to happen no matter that it was they who HAD to be in the property without delay, when they move in to find the cooker door glass broken, has to be to always build that extra week to the availability date and even though void periods are created by this practise and it goes against our intentions as Letting Agents, it is better to avoid problems for new occupants and give their Tenancy the start we would all wish for.

25Feb 2011

Property Landlord advice: Block Management and Letting Agents. (Part 1)

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By Steve Roulstone

Henley Grange Halesowen.

Over the years of running a Letting Agency, several different opportunities come to light and most Agencies do at some stage along the way, get the opportunity to advice or run a Block Management Company. This is exactly what happened to my Company and we now look after a total of 14 sites throughout the Franchise area of Staffordshire.

Block Management explained.

For those in the know, this is well understood, but if you have never had anything to do with what are mainly leasehold properties, or lived in a location where there are shared facilities, it may not be so obvious, so let me explain: In simplistic terms, Block Management Companies are set up to oversee the running of Leasehold properties such as apartment blocks (nowadays nearly always with Freehold properties attached, because of Planning authorities insisting on new sites having a cross section of affordable as well as ‘Executive’ type housing) appointing and therefore paying for such services as Cleaners and Gardeners, organising insurance cover and also giving a platform for all who live within the site to comment or even assist in the day to day running by standing as a site Director. Companies such as ours carry out the collecting and payment of services rendered and stands as Company Secretary to carry out the formal running of the site in line with any and all legal requirements and are appointed by the Directors.

Why Letting Agents?

What normally happens is one of our Landlords will get frustrated at the lack of contact or accountability of the existing Managing agent (Professional appointed body) and ask if we can assist. This is how we started and all of our business has come about through recommendation since that first site in 2003. This is because as Companies, Letting Agents are set up to operate in a very similar way and of course we can soon adjust our services to take Block Management on board.

Training and Professional standing.

Within Castle Estates, we offer training for all of our offices whenever opportunity presents itself, this is to ensure that the training is given when it is needed and therefore better utilised by the offices and the customer of course benefits as well from up to date information. Our professional bodies also recognise the services we give as Block Management Agents but there is a separate body ARMA Association of Residential Managing Agents (as opposed to ARLA) which it is wise to apply to join when numbers of sites increase. In our case, when we developed to the stage of having a separate division within the Company, just for Block Management.

So what advantages to the customer.

The normal reason and this I am sure is countrywide, is lack of approachability and poor communication that results in  a lack of trust, but of course the disillusioned owners and directors nearly always look to their own locality for a solution. And this is exactly why so many Letting Agents come to look after so many local sites. This is exactly what we can offer, accountability and easy simple approachability and communication. OK there are people who do not communicate well no matter where they are located, so I guess that is my hint to anybody taking over a local site because of problems with the existing agents – communicate with your new customers. We do and have shown considerable growth because of it!