Warnings issued over the rise of online letting agents
Fran Mulhall, Regional Operations Manager at North East property rental specialists GFW Letting, discusses the rise of online letting agents and why the region’s landlords should use them with caution.
“It’s fair to say the private rented sector is booming. In fact, since 2002, it has almost doubled, from 10% to 19% by the end of last year. As the letting market has evolved, the traditional letting agent has increasingly faced new challenges as they adapt to the ever-changing UK rental landscape.
One such challenge regulated high street agents face is that posed by the rise of online, often unregulated, letting agents in an already crowded and competitive market. A few years ago, online agents were pretty uncommon but now, as we approach 2017, they’re gaining momentum – and fast.
I do understand why they’re proving popular with landlords – online agents are convenient, open outside of standard business hours and they do typically charge less than high street agents. It is easy to see the attraction to using an online agent as a landlord who is trying to let out their property not only quickly but also at the least possible cost. Online agents are starting to use portal tools too such as Rightmove and Zoopla and traditional property signage outside properties which are also adding to their appeal. With online agents, many landlords can take a very hands-on approach; showing prospective tenants around the property and meeting the tenants themselves which might make them feel more confident and comfortable with their choice of tenant.
However, although seemingly cheaper and convenient, I believe the growth of the online letting agent is a false economy. The defining role of the letting agent is both to let out your property but also to ensure you are legally compliant with existing and emerging legislation. Can you be sure that a faceless online brand will have accountability for ensuring you’re compliant with the Right to Rent checks, or changing energy efficiency legislation? Promoting the unique selling features of a property that landlords want to lease out is also a key part of process therefore face-to-face, regular contact with both the landlord and prospective tenant is vital. It is the agent’s job to present a property as ‘home’ to tenants as they attempt to lease out the property as quickly as possible to the right tenant on behalf of their client, the landlord.
Online agents lack a personal, one-to-one service and are simply not skilled in promoting a property and pointing out its advantages. They’re very unlikely to be based locally and therefore will not be knowledgeable about the local market including current rental rates in that specific area, something which the traditional agent knows like the back of their hand.
There’s also the management aspect to consider. If something goes wrong or there is an issue with the tenant or property that needs resolving quickly and effectively, then the local, regulated letting agent is the person who is best placed to deal with this.
Although the attraction to save money by using an online agent might be strong, landlords could end up with even higher costs if things don’t run smoothly. Online agents are unregulated so if anything was to go wrong – lets face it you can be dealing with anyone online – landlords are not protected. In a growing market, it’s never been more vital to therefore work with a traditional, local letting agent with a shop front, who is fully regulated and informed about the local market and area.”