Growing regulatory complexity is encouraging more landlords to move from self-management to fully managed lettings services, according to Lomond.
The agency group said the Renters’ Rights Act and Making Tax Digital had increased demand for professional guidance as landlords sought to understand how the changes affected individual properties and responsibilities.
Lomond’s latest Quarterly Insights report identified a notable shift towards fully managed services following the increased focus on compliance across the private rented sector.
Sophie Danes (main picture), Group Director of Property Management at Lomond, says misconceptions about agency fees and the role of property managers continued to prevent some landlords from recognising the financial and operational benefits of professional management.
MANAGEMENT FEES VERSUS RISK
One common assumption is that landlords automatically save money by managing properties themselves.
However, Lomond argues that arrears, prolonged void periods, compliance failures and unresolved maintenance problems could cost considerably more than management fees.
Self-management therefore remains cheaper only when nothing goes wrong, while professional agencies provide systems, established contractor relationships and regulatory knowledge designed to reduce risk.
The group also challenges the idea that finding a tenant represented the most difficult part of operating a rental property.
Although referencing helps reduce risk, it cannot guarantee how a tenant will behave throughout the tenancy. Agents must also manage deposits correctly, maintain communication, undertake inspections and address problems after occupation.
“Good marketing moves tenants in, but proper management keeps tenancies working smoothly,” Danes says.
MORE THAN CONVENIENCE
Lomond says online information could not always replace property-specific advice, particularly given the hundreds of legal obligations affecting the letting and management of residential homes.
It also rejected the perception that fully managed services were primarily a convenience for landlords who lacked time.
Danes says professional management should instead be viewed as an investment in protecting rental income, regulatory compliance and the long-term value of the asset.
“A good agent will conduct inspections, regularly maintain contact with tenants and proactively manage the property in a way that troubleshoots issues earlier,” she says.
