Defining responsibilities in the contract

If a landlord enters into any agreement with an agent, he should sign a written contract with them indicating what level of service they are offering, and their agreed fees. It is important to read the whole contract and for the landlord to discuss any points he is not satisfied with before signing, so it can be varied or an alternative agent sought.

The landlord also needs to agree how the contract can be terminated for any reason, including if he wants to take over management himself.

As in many businesses, a small proportion of agents may not make a reasonable profit and can go out of business owing both the landlord and tenant money.

Investigate the agent. It is worth trying to get a personal recommendation (the local landlords association may be helpful here). Check how long the company has been in business, how many premises they manage, what training their staff have received, and whether they are a member of a professional or trade organisation such as:

• The Association of Residential Letting Agents (ARLA)
• National Approved Lettings Scheme (NALS)
• The National Association of Estate Agents (NAEA)
• Royal Institute of Chartered Surveyors (RICS)
• The Housing Ombudsman Service (HOS)

Websites for all these organisations are listed in Additional Resources for this course.

Fees and costs of using an agent will vary, and cheapest is not always best if the agent is not an expert in good management practice and housing law. It is also important to choose an agent who is familiar with the type of property you are letting, so take a look at the other properties they are dealing with. You could also get someone you know to contact them with enquiries about renting a property to see how they treat potential tenants.

Although the agent can carry out the day-to-day management of the property, a landlord should ensure that he continues to check periodically during the contract that the agent is managing the property properly, collecting the rent and passing it on to the landlord, knows who is on the tenancy agreement and is carrying out necessary repairs. In this way the landlord can be reasonably satisfied that his liabilities are being discharged.