Property Management – Services Breakdown
When you buy a property for buy-to-let you have a few options open to you with regards how you manage the property, either you pass the property over to a letting agent or property management company and let them deal with the property on a day to day basis, or you take on the property management for yourself. Both of these solutions have their merits and drawbacks, within this article we will examine what the property management companies offer in terms of the general services. Property management companies are service providers and they will give you a full service for your property from the tenant search, everything in between, to the tenant move out. Unless you are a full time landlord, manage properties and have the time then most likely you will be looking to instruct a third party to undertake the day to day business.
So what services are provided by a property management company?
Property management companies vary considerably from the services that they offer and the fees that they charge. A basic property management company will provide something along the lines of the following services:-
Tenant Find Only – Charge a one off flat fee to find tenants suitable for your property; prices vary for this service but will usually be around £60.00. After a suitable tenant has been found it will be your responsibility to take on the management of the tenant and property.
Tenant Viewings – Will be arranged by the chosen property management company, you will have the option to be onsite whilst the potential tenants are shown around so you can vet the tenant.
References – Previous character and job references will be gathered in order to ensure the tenant has a good history.
Rent Collection – Ensuring that the monthly or weekly rent is collected and forwarded to your account in a timely manner. Dealing with any arrears or payment problems, options are available for guaranteed rent schemes which will be provided by some of the management companies.
Monthly Statements – Issue monthly statements of deposits and work done with a detailed breakdown of the charges for your accounts.
Deposit Collection – The collection and holding of the deposit in a secure bank account for the duration of the tenancy to cover any damage caused by the tenant.
Periodic Inspections – Provide inspections of the property on a periodic manner, usually every three months but can vary depending on circumstance and instruction. A report will be drawn up and issued with your statement should this be required.
Minor Repairs – Carried out subject to the landlord contract agreement, often smaller repairs are carried out as and when necessary without the need to consult the landlord, the amount is predefined within the landlord contract and is subject to initial agreement. Electrical and Gas problems will usually be carried out immediately on safety grounds.
Gas and Electrical Checks – It is legally required for the property to have a gas check on an annual basis and all supplied electrical appliances need to be PAT tested. Copies of the certificates should be held with the property management company should they be required.
Property Management companies charge a percentage of the monthly rent as a fee for looking after the tenants needs and the property during the tenancy period. These fees will vary considerably from agency to agency, when you are looking to instruct take time to read the small print of any documents and contracts, look out for hidden charges and fees that may not be visible from the off set. Do not always base your decision just on the cheapest option; base your decision on reputation, professionalism, accreditations, advertising and visibility of the property and honesty. Look out for hidden charges and costs, for example some property management companies will levy a cost on top of repair work, this can be as much as 10% and this is something to be aware of before you sign into contracts. Always ask for a complete breakdown of costs so you can be sure that you know what charges to expect during the period of the landlord agreement.