Renting out our house

[Oceanp94]

Hiya 😀
Has anyone had any experience renting out a property using an online service like this one :-

www.openrent.co.uk/rent-now

My aunt has 2 properties , one of which we are going to rent from her -so we will be renting out the property we own . I have information about changing our mortgage over to buy to let so know where we're at with that side of things but locally agents charge 12-15% to manage which is a bit steep for us , therefore I'm looking at managing it myself.
Does anyone have any advise please on the best way to do this -the website I've shared looks good for setting everything up (tenancy agreements / references & deposit)

The best thing to do is to pay £99 for membership of the National Landlords Association. Their website has lots of courses on becoming a landlord and all the legal requirements, pitfalls etc. It's not easy being a landlord - there are some serious legal responsibilities so the more informed you are before the start, the better. You'll also need to register with HMRC.

Forgot to say, if you're managing it yourself make sure you have access to people who can fix boilers, electrics etc well and quickly. You can use Agents to find and vet tenants only - you don't have to use them to manage after that.

Speaking from personal experience i would just use the agent and pay the 12% fee. Running after tenants to get rent is a nightmare and having to find plumbers/electricians etc yourself at short notice can be a real pain. Agents deal with everything, from chasing rent to sending out their maintenance guys at short notice. Also tenants tend not to take piss when dealing with agents..

I use an agency as well.
Great at vetting tennants, getting work done and complying with legal requirements with no worries.

Ok great thanks for al the replies and yes point taken about using an agency will definitely give this more thought . With both of us working , 2 small children (1 with Asd) it may be too much for me xx

I wouldn’t use the company you linked to. They list ‘no admin fees’ as a benefit of their service for tenants - admin fees aren’t legal anyway.

Just seen your most recent post - please just use an agency. Your tenants need someone who can respond quickly to problems and get them sorted.

I would never use an agency for anything other than tenant finding. You need to do a course on landlords statutory regulations in any case as this is an area full of charlatans and thieves. If you don't know the law how will you know your agent is following it? It really needs to be a professional service which you can give, if you can't don't do it, it's foolish.

Not mentioned yet, are you aware of the tax implications? Both income tax and capital gains that may apply when you come to sell? These could be significant.

I'm only just starting to look into this

We've had some issues with several agents whilst renting out property but in the last few years legislation has been tightened up and you really need to be up on things to be able to manage yourself. Tenants often have an unrealistic expectation of how long problems should take to fix so if you don't have good people on tap it can be a struggle. I have had better experience with agents who solely do lettings rather than joint sales/lettings agents.

Side note and you may have already considered this but if you rent out your property that is considered income and taxable. I think most of the tax breaks there used to be available are no longer so. If only one of you works you can nominate the other to receive all the rental income and unless income after expenses is above whatever the current no tax rate is (12.5k ish) you wont have to pay tax but if you are both working and earning over the personal allowance threshold you will end up paying tax on your rental income at 20% or higher.

Some good advice above.
I live near my rental property and much prefer to manage it myself.
I have used both agents and Open Rent to find tenants. OR are good and obviously much cheaper but a good estate agent will be proactive and probably find tenants faster therefore your income will start sooner!
I would definitely advise doing a landlord course because the (legal) buck will always stop with you.
I would also advise you personally meet with any prospective tenants after the first fact finding/vetting by the agents. The only problematic tenant I had very early on when I was inexperienced, was one I didn't meet beforehand. Had I done, I would have rejected her instantly.

As mentioned, using an agent does not take away any responsibility from you. Do the sums with all the insurances you will need: buildings, contents, legal expenses, rent guarantee, malicious damage.

if you can't afford that fee the whole thing is a non starter. Sell up.

Tenants often have an unrealistic expectation of how long problems should take to fix

Or we’re used to really good agencies - they do exist! Ours will sort most problems within a couple of days.

It all depends on the tenants you get. Using a local agent is better as they know the area well and I would go fully managed initially till you get the feel for the business. I used OR once and never again as they do not know the market in your area and the main thing is matching suitable tenants to your property. Be strict and have a clear idea of what you want. Pets? Children? Sharers?
The other thing is that the regulations are changing daily. NLA would help and the fee is tax deductible.
Finally you need to keep very good paperwork should you need to evict a tenant
paperwork should you need to evict any tenant

I agree with @Louise91417, Speaking from personal experience i would just use the agent and pay the 12% fee

Agents have access to all sort of trades people at decent rates because they can provide a constant flow of work. You can't, so it will be more expensive and include call-out charges etc.

Agents know the law better usually, what you and your tenant can and can't do etc.

hmm.. I use a very helpful branch of a national agency, the branch do know their stuff although the central office have got it quite seriously wrong more than once. I know my stuff too because it is my business.

BUT I never get a tradie through the agent, the markup is huge. For example, I get the boiler and another appliance fully serviced, plus the certificates, for less than the agent would charge for just the certificates. And yes, the chap is fully gas safe certified.

General consensus here is get it managed but I'm a it concerned about costs as well be renting somewhere ourselves for much more. Months and months could go by with nothing needing attention

It will be way more expensive if you don’t use an agency tbh

I rent out five properties and manage three myself. Two are let to friends so it's just a quick call if there's a problem and they sort it themselves and I pay for it. The other has been a bit more problematic but not extreme. The two I don't manage (due to distance) the agents can be worth it - they have to placate the tenant and arrange for workmen. Yes you pay over the odds but its peace of mind and reduced hassle.
I generally use an agent to find tenants even if managing myself as they deal with the paperwork up front. I haven't used online services but prefer to deal face to face (and are they going to show your house to perspective tenants)?

I manage my rental myself .
I did the research and got all the paperwork and legalities sorted . It seemed overwhelming to start with but there is plenty of info out there .
I didn’t want to lose 12 per cent very month to an agent when I can do the same job myself .

There's going to be new legislation about needing a qualification to be a landlord though too 😟

really? Evidence?

in some areas (e.g. Wales) you need a license to be a landlord. This is just extra cost for the good landlords and is ignored by the rogues, plus there is no enforcement so it does nothing.

what is coming is electrical certification - that has fallen under the covid bus but will happen at some point. There are not enough electricians in the UK to do it and the certs will cost a fortune. You should of course ensure that the installation is safe.

if it has a low EPC it is already illegal to rent it out, as of two weeks ago.

Agree with other posters, this is really not something to be undertaken lightly, you need to fully understand your legal obligations as well as the tax implications, if finances are tight, not understanding what is allowable ( you cannot offset your mortgage payment against rentable income, interest payments now also being reduced (if not already gone)) can really impact your income.

Landlord zone is a really helpful forum too and second the recommendation to join Landlord Association (fee is tax deductable or was when I rented a place out anyway so check if still correct).

I’ve used agents when I’m out of the country, I wouldn’t if I was local. The agent literally takes the phone call from the tenant and phones you. Got 15%