In previous sections we have looked at what contracts are in place and what each individual in the letting agencies sphere, actually wants from the relationship too. Here I want to look at what tools do we need to be a success in this modern world.
When I first decided to go into starting a letting agency business in 1990, all I had was a name, a phone and car to do the appointments. Mobiles were not invented, computers didn’t have hard drives and the Internet didn’t exist, so things were very different. We could place an advert in the local’s paper asking for landlords and tenants and then just answer the phone and get on with it! Now we need so much more, as our Market is bigger and with the Internet, we are much more visible.
Firstly you need to consider carefully what name you will trade under and what you USP is, what makes YOU different from all the others, do you have any specialism’s, in any particular area, where can you excel against your competition and does your name and profile reflect this. You will then need to arrange the creation of a logo and brand.
The web is ever more important, and we are now in a place where core content is produced in 48 hours, than was produced between the beginning of time and 2003! Also 93% of purchases are researched online, so consider how you are going to be visible and findable amongst all that! You obviously need a good website and online presence, optimised with high rankings on Google to become found locally when a landlord or tenant starts to look for an agent.
Before you become a letting agent, you could look at the BFA (British Franchise Association) to help you select from the accredtied range of Letting agency Franchise packages or decide to go it alone, either way you will need to secure a software system to manage your business, letting is so complex, and needs lettings software systems, documents and processes to run effectively nowadays, and it really cannot be managed without one. You also need to consider data and document storage system, note keeping and communication back up, emails, property detail production and promotion, staff management, client accounting, NRL tax reporting, landlord marketing updates, legal report management, safety certificate management, contractor management, arrears management system, appointment management and charges selection and management, to name but a few, so your system, needs to be good, try to invest in the best you can.
Property portals, these have taken over the marketing of properties nowadays away from the newspapers, although newspapers still have a value. If you are not on the property portals, you will not be able to compete, with the other agents. These portals vary greatly in their production of leads, so dependent on your area, you may need to only be on one or a few of them, they are expensive so choose wisely and make sure that your system collages all the leads for you in an easy format to make sure that you never miss a lead.
As a letting agent you fulfil many roles, and understanding what you need to know to set up a letting agency can be tough, you need the skills of that of a marketeer, sales person, legal advisor, solicitor, property manager and accounts person too, this means you have a required for exceptional legal documents and letters. It is too important to get this right from day one, or else you will be continuously putting out fires. This means you either need to have all the legal training and experience to produce all the letters and legal documents you will need for your new business, or you will need to pay a property specialist solicitor or advisor to do this for you. In total we have around 100 letters, notices, contracts, terms and conditions, tenancies etc, so this can be at a huge cost, but are an absolute must! as part of our letting agency package we include full property management and client account services, so that you can focus on building yoru business rather than the painful admin.
In my business I have a process for everything and these have been developed over more than two decades, but when you start on your own you will not have these, but it is too important to start to create these as soon as you can, firstly to make sure you yourself do not miss anything, (as in our business, 1 missing piece of paper could land you and your landlord in jail!) but later on to ensure that any staff you take on do not miss anything.
when starting a letting agency business, you should consider creating processes for, taking on and marketing a property, security for conducting viewings, the referencing and file set up, the move in(so important to get this right), the file verification and activation, the management, maintenance procedure, taking on of contractors and ensuring compliant, a complaints procedure, safety certificates renewal, inspections, check outs, deposit registrations and returns, paying rents and ledger/statement production and collecting arrears and evictions. When you do employ staff later, of course you will have a whole new set of HR processes, salary structures, commissions, profit shares, disciplinary, staff management and motivation tools needed too.
Legal knowledge is I believe, one of the most important things you will need to run your business successfully and to keep yourself and your landlords out of trouble. Without this you WILL get into a mess. You are seen as an advisor as a letting agent, and therefore you will get asked lots of questions on landlords appointments and at viewings and move INS, that you will be expected to answer. You will have to resolve complex, legal situations created by both landlords and tenants strange demand and behaviour, which if you do not jump or deal with can leave you liable for prosecution. What is worse, is that without legal training, you do not know what you don’t know, you will not know you are breaking the law, even more concerning is that you are breaking the law on behalf of a landlord client!! This means he can take action against you for negligence too.
The amount of issues that can happen in a typical letting agency are never ending, and you have to know what to do in all those situations, sometimes very quick snap decisions are required of you too. So money and time MUST be spent here, educate yourself, learn and understand all you can about everything to do with landlord and tenant laws, contractor, safety regulations etc, it will reap you rewards in the on run. I have been in this game for 22 years now and I learn something every day, that’s a lot of knowledge, and knowledge and support is the No. 1 reason many choose to enter lettings by taking on a Letting Agency Business Franchise Package.
In part 1, I discussed what terms and conditions, tenancy and employment contracts with our staff require us to do, in part 2 we looked at what all parties expect from using and agent, and here we have looked at the tools of the trade. I know this all seems a lot of work and very expensive to do, and you may feel, in many parts not essential, but we live in a litigious world, and protecting yourself has got to be your number one priority, whilst you develop and discover all the things you don’t know at the beginning. Stay safe, and business is lots of fun, get it wrong and it’s painful…
If you would like to know more about starting up a Lettings business check out our Website dedicated to support new letting agency start ups by clicking the image below or 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.concentriclettings.co.uk