I discussed in my first article about the legal positions to consider in setting up a letting agents business, items that are involved between a letting agency, landlords, tenants and staff as these are the backbone of understanding everything that we do as a letting agency and why, and at all time these well drawn up contracts should be adhered to.
Beyond that we are a service industry and therefore the next obvious thing to identify is what do each of these different people “want” from there dealing with us and “how” should we give that to them…
When a landlord chooses to use a letting agent, at the outset, generally the only thing they are looking for is a “good tenant”, many see our primary role is providing a tenant and most do not examine what goes on beyond finding a tenant and being charged fees. However, if you look at our job in context, we probably spend, 2 weeks marketing the property to find a tenant and then spend on average 18 month managing it. Also of the staff that we employ it is approximately a 1/3 to 2/3 ratio in favour of the management and accounts teams, therefore we have more staff “managing the properties” than we do “letting” them.
However at the outset, landlords will select an agent on who they believe can let their property the fastest, so it is important to build into your process when setting up a letting agency, processes to ensure tha you have a good system for the marketing of your properties, strong photos and descriptions, great contact with large local employers and a steady feed of tenants from your selected online property portal and marketing. It is also important to be knowledgeable at the valuation and offer guidance on how to present the property to maximise its potential. This will help you win the landlord in the first place, but what makes him stay with you?
Loyalty in the Lettings business is where most agents fail, they all seem to focus on the front end marketing, leaving the team to “deal with any bits of maintenance that come through” yet these same staff are paid to let properties, so they are not particularly interested in fixing toilets that don’t work.
If the back end management of a property has no structure, if there is no team to deal specifically with these tasks (separate to the Lettings team) then it will almost certainly cause disappointment for the landlord and tenant down the line as their issues will not have the focus they want, and them moving to another supplier through disappointment.
In management the landlords main bugbear is his rent, where is it, is it paid quickly, what has been deducted, communication with him regarding arrears, statements being provided, and the dreaded M word, maintenance. It is therefore necessary to have a team member that has time to just focus on rents and statements, this role requires a lot of quiet and concentration and can cost dearly if mistakes are made.
You will also need a property manager who’s key function is maintenance and sourcing good reliable, not too expensive contractors, to work with, and to check they are compliant too, as one of the biggest complaints of landlords after not receiving their rent on time is that in their opinion maintenance always costs too much and there is always too much of it!
From a tenant’s perspective, when they engage with letting agents, it is because you have a house that they want. It used to be that tenants would trawl the high street going to agents because that where the properties were, with the agents, not know. Tenants go online to the property portals as they know all the properties are on there.
So you need to have a presence, and when starting your letting agency getting on the property portals is of key importance to get the initial enquiries, but beyond that what is important? If you have the right property hut are the worst agent in the world, tenants will still let through you, as at this point in the process, most tenants won’t look beyond the property, but when they move in again, just as with the landlord, the secret to keeping them and getting good reviews from them is all in your success at the back end management.
The biggest gripe of tenants is “lack of maintenance” they report stuff, and then nothing gets done… This is so frustrating to. Tenant that this tends to be the main reason tenants move out and onto other agents, even if they love the house, if the central heating does not get fixed, they will not stay. So again it is important to have someone focused on the maintenance of properties, the good management of the contractors, but also the management of the landlord clients.
Some landlords do not like doing maintenance and will try not to get works done or delay it, they do not in many cases understand the effect it has on their relationship with the tenant, and resulting costs of a void period and re-letting fee, therefore it is important that as an agent, we explain this to them and work with them to get these essential works done in fact, for their benefit…
There is one thing however that both parties will identify quickly if it is lacking and complain profusely about if they do not receive it, and that is communication
So what about your staff, what do they want? Lettings can be very eclectic in its day to day tasks, I have seen many agents that seem to constantly fire fight, no one really knowing what they will or should be doing next, therefore I feel one of the biggest things staff need in such an environment is structure.
Every task, should be allocated to someone, they should have the training and tools with which to carry out that role successfully and with ease. I can guarantee one thing, if a role is not allocated to someone, then it won’t get done.
Sometimes even when a role is allocated to someone the role still does not get done, why is this? Usually you have not given them a reason why to do it. Staff need to have a well constructed and thought out pay structure that reflects their role. Basic, plus profit share on what their department brings in, with both individual bonuses and then group bonuses. Decide what roles you want doing and then ensure that they are re-numerated for doing them, or it is out in place that if they don’t do x y z then they don’t get bonus…
I have been asked how do you re-numerate management staff. It’s really quite easy, just consider what tasks are most important and offer bonuses etc on these specific tasks, like a £50 monthly bonus for every end month that goes by where there are NO expired gas certificates. Sales staff are obviously easier, start off with the gross pay that you want to pay them, then work backward to how many deals do you what them to do, how much per deal, what bonus for target and how much for the whole team when they hit target, because you can’t leave out the administrators. Everyone should be on some sort performance related pay.
There is one thing however that all parties will identify quickly if it is lacking and complain profusely about if they do not receive it, and that is communication, landlords, tenants, staff will quickly feel isolated, if they do not have adequate communication. Landlords expect to be kept up to date and informed of what is happening with their properties, tenants, want maintenance and issues dealt with swiftly and staff need to feel part of the team.
Communication, motivation and guidance needs to come from the top down, but they also need to be listened too and have a voice upwards too. Being part of a thriving company, should be fun, they should be able to all celebrate their successes together and feel the excitement of all the team and their managers when they do well, we have bells that we ring when something good happens and everyone stops to find out what’s happened, this really makes feel staff listened too and appreciated, it’s not all about the money. In contrast there needs to be a fair disciplinary process in place, as any failing members of the team need to be dealt with swiftly and fairly too.
So there you have it, my take on what all, parties in then lettings arena and what they WANT.
If you would like to know more about starting a Lettings business check out our website dedicated to setting up a letting agency business by clicking on the screenshot to the right or clicking HERE
Sally Lawson is a Leading authority on Residential Lettings and Management in th UK, Sally has ran Lettings Branches since 1990, and let over 5000 properties during that time. She has also worked as a consultant and trainer to Letting agents nationwide. Sally is actively involved with ARLA (the association of residential letting agents) as a regional representative and Media Spokesperson for the group, and runs the rapidly expanding nationwide Concentric Lettings operation and Franchised network. www.SallyLawson.co.uk