I think that lettings and property management has a unique pressure as you have long, ongoing relationships to maintain with both sets of clients - your landlord who pays your fees and the duty of care you have to the tenant.
It is imperative in a busy market that you don’t lose sight of what you are there to do. You are there to keep people calm and happy, so managing expectations is key.
One area of property lettings and management is complaints; we try to deal with them efficiently. Maintenance duties are a good example. At the moment, during the pandemic, if a maintenance issue is not deemed an emergency, we are unable to attend, so we tell people early on what we are able to do and not able to do.
What about the effect on professionals?
The pressures of this market are easily absorbed by staff and that’s important to realise. We must look after our staff as they are the face of the company, and they need to be able to put their hand up and ask for help and breaks when they need it.
Properties are letting so quickly, and people are not moving out because of the lack of available property; when one comes available, we might get 200 people wanting that property. It becomes a real skill to pre-vet applicants, so you know the best tenant for your client. The demand on our staff in these situations can be immense because they are registering everyone and ensuring we are fair to everyone involved.
I’ve been doing this for 30 years, and this landscape is really quite unique. Yes, it is stressful, but it gives us the opportunity to practise the skills we have built up.
Is there a temptation to drop management fees in today’s market, especially with such a short supply?
As lettings agents, we are used to working alongside other agents. It’s more competitive in that way than estate agency which typically prefers sole agency, so we have to be quick, effective and efficient.
But I always tell my staff, you are worth every penny. We put service first; giving a duty of care to two sets of clients, the hours we work and the pressure we are under equates to a valuable service that doesn’t come cheap.
If a landlord says your competitor is cheaper, I make them aware of what we do because I think you get what you pay for. We are talking about the safety of their biggest asset and entrusting it to an agent who will look after it, put in every effort to find the best tenant and be on the phone to navigate difficult times with them, such as we have seen in the pandemic, is more than worth the price.
If you have a register of desperate applicants, do you still need to market properties?
Yes, we do. Even though we have a database of 'Hot' applicants, we do stipulate in our contacts with landlords what we will do for them, and part of that is the marketing process. So, even though we have some great tenants lined up, we do still need to put the properties live online to make sure we get the very best tenant, and we are fulfilling our agreed terms and conditions.
It’s actually so competitive at the moment, and with the pandemic, we have a lot of tenants who have taken properties they haven’t seen. So, our marketing has been really challenged during the pandemic to make sure what we are presenting is the mirror image of the property and providing maybe more information upfront than we would have done previously.
We manage 4,000 properties and we haven’t had one tenant that has come back and felt misled.
A lot of tenants are missing out, but what effect do you think this market is having on landlords? Is there anything negative, or is it a great market for them?
Landlords will never be in a position to get such a high rent as what they are getting now. I would say that the majority of landlords are delighted as they are getting very few voids and, because of demand, the income is increasing. However, there has been many issues with rent arrears and landlords could be in a situation where they are struggling to keep their head above water.
We have been fortunate that the UK government has been supporting tenants financially to try to prevent the escalation of rental arrears. I think what’s concerning now is that court action is going to be very slow, and if landlords have a bad experience, they may be promoted to sell.
So, there are concerns that landlords could exit the market. But there will always be investors, especially now as the yield to value is higher than it ever has been.
How do you deal with landlords who are in difficult situations?
We must be realistic. The first thing you do is to try to help the tenant to be able to pay their rent. When courts re-open there will be a backlog, so supporting the landlord to work with the tenant is key.
That’s why having a good agent is so crucial, because being able to negotiate and support between both clients is a real skill.
How do you deal with landlords who know it’s a busy market and are asking for rental figures that are unrealistic?
Nine times out of 10, landlords are delighted because their rental income is much more than it has been. But if I meet someone who is very unrealistic and won’t budge, I am more than happy to say I do not think we are the agent for you.
We have to treat people fairly and people shouldn’t have to unrealistically pay through the nose to get a roof over their heads. You can only achieve rent that it is relative and current, and we have the expertise and research to demonstrate those figures.
*Angela Davey is ARLA Propertymark's President and head of lettings for Peter Alan