The private renting sector provides a major service in Britain today, supplying homes for millions of families and involving investments of billions of pounds. Management is a professional business – or at least it should be.
Yet the evidence is that some property owners still take an amazingly amateurish approach in which they cut corners, trust to luck and fail to take the most basic steps to ensure that tenancies go well from their own point of view or from that of the people living in their flats and houses. It is a recipe for ending up with disputes.
A recently published national survey produced results that suggested an estimated 400,000 landlords (29%) have had their property damaged by a tenant in the last 12 months.
That is, of course, a headline-grabbing stat, the importance of which is difficult to assess. A broken light switch or a mark on a wall could be described by some owners as ‘damage’. Minor stuff that is comfortably covered by the tenant’s surety deposit.
Of more concern is the number of cases in which the damage to the property is greater than the tenant’s deposit. The survey revealed that in perhaps 120,000 cases (8%) landlords had to make an insurance claim of one kind or another.
A spokeswoman for the professional landlords organisation that commissioned the survey said that it flagged up a couple of really important points: First that many of the landlords who suffered loss failed to properly vet applicants. Secondly, many landlords were not properly insured or indeed insured at all.
As I mentioned, property management is a serious business. It goes without saying that proper tenant assessment . . . in terms of references, credit checks and any guarantees that may be involved . . . are a routine but important part of the service that we at DDM Residential provide to local landlords.
Such tenant checking will not mean that damage never occurs during a tenancy but eliminating people with a poor track record will minimise the risks. Clearly failing to vet prospective tenants properly is not wise and can lead to the sorts of issues raised in the survey.
At DDM Residential we have extensive expertise and contacts in the field of rented property insurance. Having the right specialist policies and protections in place is vitally important. I was staggered by the finding that close to half of the landlords who responded to the survey (49%) have no such insurance. If they are being advised then they are being badly advised.
At the end of the day, there will always be some poor tenants and things will happen and damage may be caused but with the help of professional managing agents, operating good systems, those situations should occur very rarely . . . and much more rarely than this survey is suggesting. (And even in those rare cases that do occur there should be insurance in place to rectify the situation.)
On to less contentious matters: The renting market in the local area is ticking over quite nicely at the moment with a decent demand being met by a decent supply.
Despite reports of soaring rents in some parts of the country . . . and fears about the impact of the Budget changes to buy-to-let mortgage relief . . . not to mention the possibility of interest rate increases . . . rents in our patch remain remarkably stable. Currently the average rent is around £500 a month, which means that we continue to be one of the most affordable areas.
Looking at our lettings list earlier this week www.ddmresidential.co.uk I find that the 80 properties currently on offer include several at under £300 a month including a two bedroomed apartment in Grimsby (£250) and one bedroomed flats in both Cleethorpes and Scunthorpe (£275). The most upmarket property currently available is a very nice four bedroomed detached bungalow at Bradley (£800).
One last mention of course about the recent property auction that was held on Tuesday 28th July at Forest Pines, Brigg. 19 of the 23 (82%) lots offered for sale were sold with a capital value of £1.7 million. Full results can be seen on our website along with new auction entries for the September auction. For a free Landlord Guide to Letting or more information on how to buy or sell at auction visit your local DDM Residential office or call 0845 4 599 499.
Graham Wilson, Managing Director