Selecting your agent
You want to find the right tenant, with suitable references, at the appropriate market rent, as quickly as possible. It is important therefore to choose an agent with good credentials suited to your particular type of property and its market. You can appoint more than one agent without increasing the cost to yourself.

What is their staff training policy?
Do they have other branches which will also market your property?
Can they offer choice of short or long lets?
How do they market the properties?
Do they have a website?

Marketing your property
Finding quality tenants requires an enormous commitment of funds and resources. You need wide exposure to obtain the best rent in the shortest possible time and to secure a good quality tenant. The quality of the tenant is ultimately as important as the level of the rent. All offers that the agent receives will be passed on to you with the agent’s recommendation. Since you may well be living at a distance, you have to place some trust in the agent’s professional judgement. It is the agent’s responsibility to balance an attractive rental offer against the potential risk of any particular tenant. You should expect your agent to raise even the smallest doubts they might have about the suitability of any applicant.

Short let option
An option landlords may consider is short letting for periods between 1 and 6 months.

Benefits:

• Short Lets offer you flexibility if you are unsure about how long you are able to or planning on letting your property.
• It is less risky than organising a private let and has many advantages compared to leaving your property empty.
• The Short Lets market is also less seasonal than the rest of the property market as many tenants are from overseas and they tend to travel to the UK in a steady flow.
• As an investor Short Lets rents can achieve between 25% and 50% more than the long let rental.

Requirements

• Fully furnished and fully equipped including all kitchenware, crockery, linen and laundry including towels etc
• The same safety regulations apply as with Long Lets
• Additional Costs
• Your property must be fully equipped, for example with kitchenware, crockery, linen, laundry etc
• You may incur costs for the utilities as they are included in the rent, excluding the telephone
• Short Let fees are higher as a proportion of rent because of the work involved over the year.

Taking up references (applicable to both Long & Short Term Lettings)
The tenant will be either a company (in which case the occupant is legally termed the “licensee”) or a private individual.

If you are Letting to a Company
If the Company is not a household name, a company search is imperative. In addition the following references should be requested from an accountant, bank and solicitor. If any of these are not available, a trade reference can be substituted.

If you are Letting to an Individual
At least two references should be taken. A reference from their accountant or solicitor can also help to establish their financial and/or professional standing. If the tenant is not in the position to pay the rent By there own means then a guarantor should be found. Again, at least two references should be taken and an approved Guarantor Certificate should be signed.

A bank, for instance, is unlikely to give a reference if the account has been open for less than six months. In a case like this, take the advice of your agent. Note: all of the important references are not always available.

All references have to come direct from the referee to ensure that they are current and genuine. References passed on by the tenant should not be accepted. In order to be as thorough as possible some agents do all referencing through a specialist credit referencing company. Where references are not conclusive the Landlord has the option of requesting a Guarantor or an advance on rental payments.

Making the decision
Right Tenant?
Important as it is to achieve the best rental, it is if anything more important to get a tenant who is respectable and trustworthy. So consider first the calibre of the tenant.

Right Rent?
You are of course looking for the best yield you can achieve. The rent will usually be paid in monthly or quarterly instalments. A deposit, usually equivalent to six weeks rent, will be held by your agent as stakeholder against the cost of dilapidations or unpaid rent when the tenant leaves. For Short Lets, due to the higher rent achieved, only four weeks deposit will be taken. (Note that this money can only be released to you with the written agreement of both you and the tenant). In cases where a corporate tenant is in occupation, this may be in the form of a Letter of Guarantee.

Right Term? Long Let
The tenancy agreement will usually be for one year less one day, sometimes with an option written in for renewal in the second and third years (see page 16). There may in addition be a “break clause” which allows the tenant to terminate the tenancy prematurely. Most big companies now insist on this for their employees (whether the tenancy is in the company’s name or the employee’s). A Landlord should note that if there is an option to renew, a break clause will not be operational until the final term.

Right Term? Short Let
The Tenancy Agreement for Short Lets can vary greatly. On average, two to four months is the most popular, although any tenancy from one month to six months can be undertaken subject to any restrictions. There may in addition be a ‘break clause’ which allows both the tenant and the landlord to terminate the tenancy with suitable notice. This notice will vary subject to the initial term of the tenancy. Most large companies will insist on this for their employees. Confirm you are satisfied with the type of references being applied for - which should include Bank, Employer and Previous Landlord. Some agents may use a credit card reference company.

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