If you live abroad, but own a property in the UK, unless you have friends or family willing to look after it for you, you will have to sign-up to a property management company.
There are hundreds of firms who advertise this service; but not all property management companies are equal.
You’ll find firms who are excellent, carrying out your instructions and then some. On the flip side, there are the companies who tell you that they’re checking your property on a monthly basis…who insist it’s not their friends they got round to fix the blocked toilet in your flat last month, but a professional plumber, which is why they’re billing you an additional £160.
You can, of course, ask for recommendations if you know someone who has used a trustworthy property management company. You can read online reviews too, as most companies these days have a website and social media pages. There are some questions though that you will really need to ask a prospective property management company in order to put your mind at rest. These questions include:
- If they have signed up to a Tenancy Deposit Scheme
- If they have professional indemnity insurance (meaning your rental income would be protected were the company to be sued etc).
- If they are are a member of a professional body (such as the National Approved Letting Scheme (NALS), the Association of Residential Letting Agents (ARLA) or the Royal Institution of Chartered Surveyors (RICS). In an ideal world, they would also be registered with The Property Ombudsman.
What services you can expect
A property management company for overseas landlords will typically:
- Advertise for tenants and vet them with regards to credit checks and face-to-face interviews;
- Draw up a lease and have the tenant sign up;
- Draw up an itinerary and go over this with the tenant present on the day they move in;
- Ensure rent is paid in to your account every month;
- Do a monthly or quarterly inspection of the property;
- Advise on any necessary repairs or other work that’s required on the property;
- Source a good tradesman and personally inspect the work once it’s been completed to ensure it’s up-to-standard;
- Ensure annual boiler and gas safety checks are carried out;
- Pay any service charges for the building (which is always the landlord’s responsibility);
- Make sure bills such as the council tax and utility bills are paid and up-to-date if there are any void periods;
- Find new tenants (see first bullet point).
What fees are typical?
For a property management company to carry out all of the above duties you can expect to be quoted anything from 10% to 14% of your rental income (up to 20% in London). If you’ve more than one property that needs their services then you’re in a better bartering position.
How to change your letting agent
If, after reading the above, you decide you want to get rid of your existing property management company, then do so in writing. But first, check how much notice you have to give them – in some cases it can be as much as six months. The majority of companies only insist on a two month notice period.