The decision to invest in property isn’t one that’s taken lightly, or dealt with flippantly. The same should ring true when deciding on an estate agent partner to handle the letting out of your property. Selecting and dealing with tenants is a specialised task and one that if not managed correctly can amount to a massive amount of administration for the owner; never mind the potential damage or neglect of your rental property.
PayProp, the largest processor of rental transactions in South Africa has compiled a list of 5 things to remember when selecting an agent:
1. Only use actual estate agents. This sounds obvious, but remember that all estate agents have to be registered with the Estate Agency Affairs Board and have a valid Fidelity Fund Certificate (FFC). Some agencies are currently struggling to get their FFC from the EAAB, so if you are in doubt, phone the EAAB and enquire about the regulatory status of the agency that you are intending to do business with.
2. Reduce the mandate to writing. You may be tempted to just brief the agency over the phone and ask them to ‘get on with it’, but not having a written mandate is a massive risk for any owner. Ensure that you have a document that outlines what the agency must do and exactly what you must pay in return.
3. Understand what systems they use. Financial management is one of the most important parts of letting management – and if your letting agent is using a combination of post-it notes and spreadsheets to manage your property finances you may be in for a frustrating time.
4. Inspections have been done. Ask to see copies of the ingoing inspection report. If this report has not been done, you are not able to claim any damages from the tenant when they leave, as no baseline for the condition of the property exists. Ensure that this report is being done BEFORE the tenant gets access to the property.
5. Has a credit check been done? While the tenant has the right to decide that you as a third party may not see his credit check results, you may ask the agency if a check has been done and if their analysis thereof has provided them with comfort that this is indeed a good tenant. Ask upfront what the policy at the agency is and don’t sign a lease with a tenant until you are sure that they have been checked out beyond the ‘they guy wore expensive shoes’ criteria.
Property letting is a highly specialised and skilled field and the days of privateers ‘winging’ it are well past. Ensure that you are using an agency that has the systems and resources in place to manage your property properly.
Issued by PayProp