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Tuesday 24 December 2013

Arent all letting agents the same?

First and foremost, we’re a Lettings Agency. Once you’ve bought the property, we want to manage it for you(!), or help with just finding you a tenant. With that considered, it’s very much in OUR interests that you buy something that’s sensible and lettable – we don’t want you buying a dud, or something where the figures don’t stack up!

There’s some mutual gain here. As such we can help in a number of ways:

We’ll Give You Tip Offs!

We keep a close eye on the housing market, and run an email list of decent buys that materialise. These cover the whole market – from repossessions, to cheap DSS bedsits, to family houses in nice suburbs – there’s something for everyone. Sometimes you can even buy with a tenant in situ, which means you pick up rental income from day 1.

Some Estate Agents will also tip us off when they get a property they need to sell quickly, and landlords can pick up a good deal as a result. There’s no charge for this service – just email and ask to be put on the list.

We’ll Act as a Sounding Board

When you’ve not bought investment property before, it can be daunting. What area? What type of property? What type of tenant? How much work needs doing? You quickly end up in a situation where you have 5 different estate agents constantly phoning you and swearing blind that their deal is the best one you’ll find!

 We’re more than happy for you to come and see us for a chat about the options. Show us what you’re looking at and we’ll tell you what we think of the deal, or suggest alternatives. Or just ping us an email with a link. You’ll get an open and honest assessment of whether the deal on the table is as good as it sounds. Again, we don’t charge for this and we don’t pressure people into purchasing anything. If you want to come for a chat, email

Some people come and see us once, go and buy something, and don’t use our lettings service, which is fine. Others come and see us on repeated occasions for advice during their search for a property. This is fine too, but we kind of hope these people will use us to let the property once they’ve bought it. When we’re giving our time freely, and on repeated occasions, it’s quite frustrating to find the purchaser has let the property through another agent who bullied them into it, because they weren’t strong enough to say no!

We’ll Formally Source Property For You

We have a number of landlords who like to invest, but don’t want to do the legwork, go and see properties, or even visit Southampton themselves! In this scenario, we can source properties for you - we need a defined set of criteria, so we understand what you’re looking for, but thereafter you can leave us to do the legwork. We do charge a finder’s fee for this service, payable on successful completion of a purchase.

Wednesday 18 December 2013

Southampton Landlords .. Have you stopped getting your rent?

We've been contacted by a number of landlords in recent weeks who have stopped receiving money from their lettings agent, without reason. The agent is also not returning phone calls, and their shop is shut. Clearly the agent  in question has stopped trading, or is very close to doing so, but where does that leave the landlord, and what should he do?

From a tenancy perspective, I'd recommend the landlord do the following:
  1. Contact the tenant, and tell the tenant to stop paying the agent with immediate effect. This will stop any more money going missing.
  2. Either appoint another agent and give the tenant the new agent's details, or give his own bank details and contact details - effectively managing the tenancy themselves.
What other problems could the landlord face?
  1. Where is the tenancy deposit? If the agent has it, or rather doesn't have it, the landlord could have a problem, as he would be liable to his tenant for the full value of the deposit.
  2. Where is the gas safety certificate for the property? This is really important. The landlord may have a copy, or there should be a copy in the property. If a copy can't be found, the landlord is better off instructing a new certificate himself. I can help with that if required
  3. Where is the inventory? If the landlord wants to make a claim on the tenancy deposit, he'll need a copy of this.
  4. Where is the tenancy agreement? The landlord or tenant may have a copy. Legally the tenancy can exist without it, as a tenancy agreement can be verbal. However to prevent disputes between landlord and tenant it's worth getting a new copy signed if one can't be found.
  5. Does the agent have a set of keys? A landlord should try to recover these.
What can a landlord do to recover the money he's lost?
  • Assuming the tenant has paid the agent, but the agent hasn't paid it on, the landlord needs to take some legal advice. I suspect the prognosis isn't good.
What can a landlord do to stop this happening again?

Quite simply, use an agent who is a member of SafeAgent All members must have their client accounts checked on a regular basis and also have to carry Client Money Protection Insurance - so if the agent is experiencing financial problems, any loss suffered by the landlord is insured.

Wednesday 11 December 2013

Winter and Southampton Landlords

15 tips on what a Southampton landlord should do in the Winter

1. Turn me on!
Firstly, It’s a good idea for agents or landlords to write to tenants to request that they try putting on their central heating as soon as possible to make sure it is working, otherwise at the first really cold snap everyone turns on their central heating and, when quite a few are not working, it puts a strain on contractors and consequently lengthens response time.

2. Cheap Day return
As we enter the colder months it’s important to remind tenants that if they are planning to be away from a property for a few days they should keep the central heating on a low setting to maintain a temperature of between 12-15 degrees Celsius in the property and if possible, they should also leave the hatch to the roof space open. This can help avoid frozen or cracked pipes.

If a tenant intends to stay away from the property for more than a few days, then we advise that they turn off the water supply, and shut down and drain the central heating boiler and associated pipe work, it’s important to take advice before attempting to carry this out.

4. Fencing
Is the property’s fence going to stand up to the winter wind? Check your fence panels and trellising for signs of wear and tear and repair and replace where necessary. It only takes one weak panel to potentially bring down an entire fence!

5. You old boiler!
Make sure the boiler is serviced on a regular basis (usually once a year. As winter approaches bleed all of the radiators and keep the boiler pressure up too.

6. Frozen taps
Did you know that outside taps can sometimes be the cause of problems in winter? If you can, it’s advisable to fit an isolator to their stopcock in order to give your tenant the option to turn them off during really cold weather.

7. Why don’t men read instructions?
It’s important for tenants to know how the boiler system in the property works and they should familiarise themselves with the operating instructions and, if they are unable to find the operating manual, they should contact us (with the make and model) and we’ll try and find a copy for them.

8. Life in the Gutter
Clear out the guttering to avoid water logs and leaks, fallen leaves and moss can clog guttering and lead to rain water overflowing into the infrastructure of the building. Check for leaks and cracks in the guttering too

9. Quick thinking Batman
Reacting and acting quickly is essential when maintenance issues arise. Don’t be tempted to ignore a problem thinking that it’ll clear itself up come spring. Winter maintenance issues tend to escalate as the season progresses and the cost to fix them is likely to rise too!

10. No batteries required?
Batteries running out in a remote control digital thermostat can cause the heating to fail and Batteries should be checked regularly and replaced (using the instruction manual) when necessary.

11. Lofty ideas
Good insulation is key to keeping a property as snug as possible. Ensure the loft is adequately insulated to help avoid losing heat through the roof – and make sure the pipes are lagged too, especially those that run through the loft space and are vulnerable to sharp drops in temperature.

12. Extractor advice
Check that bathroom extractor fans are working and that they are cleaned on a regular basis as this is important in order to help prevent any moisture build up in the bathroom when tenants are having a hot shower or bath.

13. Call 999?
Have you got a plan in case of an emergency? It’s wise to prepare in advance, perhaps investing in a portable heater and electric urn in case a tenant is without essential services to the property. Supplying bottled water can be useful for tenants with no running water due to frozen pipes too.

14. Condensation – a big drip?
Although they won’t completely prevent mildew and condensation, adequate heating and ventilation in the winter months will assist in keeping the problem down.

15. Empty homes
If your property is currently vacant, it is essential that you or your agent visit it regularly to inspect for winter maintenance issues. Check for leaking windows and damp walls, plus (if you haven’t switched off the water) try the taps to make sure the water is flowing. Frozen pipes left unnoticed in an empty home can result in extensive damage and expensive bills.

Friday 6 December 2013

Southampton Landlords .. Should you take a tenant in receipt of benefits?

Most landlords who have been renting property for a while will have been asked this question, and my staff  get asked on a daily basis whether a given property will accept people who are receiving benefits.

Quite simply that’s because there’s huge demand for properties that will accept benefit claimants – Southampton City Council have ‘waiting lists’ running into the thousands which continue to grow. It is a specialised area of the market, and one that you must not enter casually. However for some of our landlords it is a very lucrative market, and they are now buying to meet the tenant demand.

These tenancies can work well, but it’s really important that the landlord understands in advance how these tenancies work, and what the pro’s and con’s are. I’ll go through these below.

The main question Landlords should ask is do I need to accept Housing Benefit Tenants to rent my property’?, For the vast majority of Landlords, the answer to this question will be no – there will be a large enough supply of good quality private tenants happy to pay the rent you want. As such you’ll stick to the private market as it is, statistically, less hassle. Landlords generally need to consider a tenant on benefits :

  • If their property is in an area where there’s low demand from private tenants, or
  • if the local market is such that there’s a shortage of private tenants generally.

What are the advantages?

  1.  You can get a premium rent for your property – Local Authorities have a set ‘scale’ they pay against, based on the size of the property, and not based on the area. As such if you’ve got a property in one of the poorer areas of town, you’ll get more for it with a Housing Benefit tenancy than with a private one.
  2. In many cases the Council will provide a guarantee bond instead of a deposit. This is usually capped at 1 months rent, but in certain instances can go higher
  3. Housing Benefit tenancies statistically last longer – if you’re claiming benefit and you want somewhere nice to live, the world is by no means your oyster! As such when tenants get somewhere nice, they tend to stay longer.
  4. In certain areas of town, a housing benefit tenant may be a safer bet than a private tenant – a single parent with children is always going to be entitled to funds, whereas a private tenant on low income and in / out of work, may struggle more to pay.
  5. More often than not, we can arrange to receive direct payment from the Local Authority, which mitigates the likelyhood of the tenant not paying.

What are the disadvantages?

There are a few here also. It's important you understand these in advance.
  1. Rent is paid in arrears, not in advance.
  2. Local Authorities make 13 rental payments a year instead of 12. You still get the same amount of rent annually, only in smaller chunks.
  3. Without wishing to over generalise, tenant often struggle to deal with issues that arise (such as their benefit entitlement being changed) and deal with this by ignoring it, or burying their head, rather than coming and telling you.
  4. If the Local Authority overpays housing benefit, they will take it back from whoever they paid it to. As such if we’re getting direct payment for your tenant, and the LA subsequently decides the tenant wasn’t entitled to that money, they will deal with it by simply taking the money back – that's democracy for you!
  5. Local Authorities aren’t geared up to communicate with landlords, and very much see the tenant as their ‘customer’. If the tenant's entitlement to benefit changes, you can bet the local authority won’t tell you – the first you’ll know is when the money stops coming in. As such Housing Benefit tenancies can take a lot more management.
  6. If you want to / need to get rid of your tenant, you can bet the Local Authority won’t help you – you’ll very much have to rely on the court process unless your tenant is happy to play ball!
  7. As an agent we lose a little bit of flexibility on which tenant we let to – the Council doesn’t like to see us making arbitrary decisions.
  8. The secret to success is hence understanding the above and managing it. If you get a reliable tenant, and a relaxed landlord, it can work really well and deliver a great yield for the landlord. If you get an unreliable tenant and an inflexible landlord, problems can ensue!

As such there can be problems with accepting tenants in receipt of housing benefit. It’s not a market that suits everyone and if you’re the sort of landlords that treats their rental properties as extensions of their own home, it’s not the market for you. That said, you can pick up a cheap property in one of the less upmarket areas of town and rent it for good money. 

We have a number of landlords who operate successfully in this market and I have a couple of places myself that I let out to tenants in receipt of benefit.

Nearly all of us get our fingers stung occasionally. However all of us come out ahead overall.