Traditional lettings agencies: the classic route
There are approximately 24,000 estate agents across the UK helping people buy, sell and rent homes. An advantage of the traditional bricks and mortar lettings agent is their knowledge of the local neighbourhood and rental market, enabling them to price and fill your property quickly.
However, technological advancements have simplified processes and led to a rise of online agents, which allow landlords and tenants to get the benefits of a lettings service at a much lower cost.
Ranging from the likes of Openrent which will advertise your property and carry out tenant referencing, to the fuller renting and management service of Howsy, these letting agency alternatives have opened doors for new thinking and are taking advantage of the shift to a digital world.
Smarter Rent’s letting and property management: a closer look
Smarter Rent is taking a fresh approach to renting. Like a traditional lettings agency, we help renters find their perfect home and a complete management service for landlords. But we aren’t just a lettings agency. We also source buy to let properties for investors and have an inhouse design team who oversee any refurbishment works, to get properties up to the standards we expect for our renters. Our approach aims to give renters the high-quality, furnished homes they deserve, while delivering an exceptional, completely hands off service to landlords too. Read on to learn how else we differ:
Generating the best rental income from your property
Traditional agencies tend to focus on long lets of a year or more and will price your rental according to other properties in the area. While long lets give you security of a tenant and don’t carry the risk or hassle associated with Airbnb-style short lets, they don’t necessarily earn you the highest rental income.
At Smarter Rent, we offer flexible tenancies of one week to 36 months, but our niche offering of mid-lets, that’s tenancies of 1-12 months, means we can charge up to double the amount of rent, while also guaranteeing good quality tenants for months at a time. For a slightly lower income, we’ll also guarantee rent for between three and five years with no management fees or voids, if you’re after a bit more security.
Combined with our proprietary pricing engine which constantly analyses the market, we are able to optimise your rental income to earn you up to 83% more rental income compared to you renting the same property with a traditional lettings agency.
Upfront costs and fees
A high street lettings agency will usually ask you to give the walls a fresh lick of paint and suggest you replace carpets if they’re old. They will then typically charge fees for finding and referencing tenants, carrying out an inventory and ongoing management fees of around 10-20% of the monthly rent. Some agents might run ‘no fee’ offers to attract new landlords and build up more stock in an area, giving landlords a limited opportunity to avoid eating into their profits.
At Smarter Rent, we offer beautiful homes to renters that feel like home. As such, we assess each home and may ask you to invest in refurbishment works and a furniture pack before we take your property on. This upfront investment is beyond what most high street agencies ask for, but we deeply understand what renters will pay for and any suggestions are made with your property’s ROI in mind. We will manage any works and furniture installation, so you can be completely hands off.
The investment will vary depending on the size of your property and what, if any, work is needed. As an example, we recently took on a 2-bedroom apartment in west London. It needed redecorating at a cost of £3,000, several pieces of furniture upgrading at £2,000, a workspace adding at £500 and the Wi-Fi upgrading at a cost of £50 a month. We also added £500 of soft furnishings and spent £500 on professional photographs to make the listing stand out and attract the highest paying tenants. The result was an increase in rental income from £2,600 a month with a traditional agent, to £4,600 a month with Smarter Rent.
We then charge 15% +VAT monthly management fees, although these aren’t paid if you opt for a rent guarantee.
Property management: time and costs
Currently 23% of rental homes in England would not meet the decent homes standard - a minimum living condition level set by the Government – and a quarter of renters are dissatisfied with the maintenance of their homes, because work happens slowly or the owner refuses to do the work.
Property maintenance is no doubt stressful and time consuming for landlords, so it’s surprising that only 13% of landlords use full management via an agent.
Most agencies will offer a lettings and management service, acting as the middleman between tenants and landlords on any issues from a lost key to replacing a boiler. If you like to be a hands-on landlord and want to approve any spend, this could be the route for you.
For landlords who are happy for their agent to look after everything for them, Smarter Rent’s complete property management service could be a better answer. We’ve designed a service that takes the burden on so homeowners can focus on other things. This means you won’t get a say in who stays in your property, how much rent we charge or the contract terms, but it also means we won’t be calling you whenever a new key needs cutting or a tap needs fixing.
Managing tenants and contracts
Traditionally, leases tend to be more favourable to landlords. For example, Section 21 notices allow landlords to evict their tenants with no explanation by giving two months’ notice once their fixed term-contract has come to an end, and two-sided break clauses mean a landlord as well as a tenant can decide to end the lease.
We believe renters deserve homes that let them live on their terms. Our contracts are purposefully designed to be very fair to renters, with tenant only breaks and transparent rent increases linked to RPI. Giving renters a positive experience means they are more likely to stick around, proven by our 750+ 5* reviews and 95%+ occupancy rate.
The verdict: Finding the right fit
If you want to retain control over who stays in your rental property, how much they pay and the terms of the tenancy, and if you’re keen to take a hands-on approach to property management, then a traditional lettings agency could be the best solution for you.
Alternatively, if you’re after a completely hassle-free management service that takes a data led approach to optimising your returns, while also giving brilliant homes to renters, then let’s chat. We’d love to have you with us.