Let only sounded like a saving. Here's what it actually cost.
Managing your own rental can look like an easy way to save money. But what happens when you factor in your time, maintenance, compliance and the risks you may not even know you’re carrying? Neil found out during his first year as a landlord.
He Saved on Management Fees. He Paid for It Everywhere Else.
When Neil bought his first rental property he was determined to keep costs down.
Found a local agent. Let-only service. Competitive fee. Tenant in, references done, agreement signed. After that, Neil was on his own.
He was going to manage it himself. Save on the management fees. How hard could it be?
The first year
The tenant was fine. Mostly paid on time.
But the year was busier than Neil had expected.
Boiler fault in February. A leak under the kitchen sink in April. A bit of a dispute about wear and tear at check-out. A tenant who fell two weeks behind on rent in October and needed a fair bit of chasing.
None of it was a nightmare. But when Neil added up the hours and the money he had spent on tradespeople — not always the cheapest because he was just finding whoever was available — the saving on management fees was not looking as impressive as it had done at the start of the year.
Then there were the near misses.
His gas safety certificate lapsed for three weeks before he noticed. His deposit was protected but he had not served the prescribed information correctly at the start of the tenancy. When he looked into it properly he realised that could have been a real problem if he had ever needed to serve notice.
The honest calculation
When Neil came to us and we went through everything together, the true cost of his first year was considerably higher than the management fees he had avoided. Not just financially. In stress, in time and in risk he had been carrying without fully realising it.
Switching to full management for year two cost him a fraction of what year one had actually cost him when you added everything up properly.
The number that really did it for me was the compliance risk, he told me. I did not realise how exposed I was. That was not worth saving on.
Your action point this week
Do an honest end-of-year calculation on your let-only arrangement.
Time. Tradespeople. Professional advice. Any compliance gaps you may have been sitting on.
Then compare it to the cost of full management. You might be surprised.
If you are on a let-only arrangement and you are starting to wonder whether it is actually working for you, come and talk to us. Switching to full management is a lot simpler than most landlords expect, and we will walk you through exactly what it involves. Call us on 01204 659670, email katie@harrisonsnet.co.uk or visit harrisonsnet.co.uk.
Here's to your property success!
Katie
Harrisons Estate Agents
01204 659670 | katie@harrisonsnet.co.uk | harrisonsnet.co.uk