Using the same agent to both buy and let through: is this the right thing to do?
Mike White, from Martin & Co discusses whether there is a disconnect between using the same agent to buy and rent property?
For any agent who offers both sales and lettings, this is the Holy Grail – a fee for selling the house, fees for a mortgage referral, commissions for insurance introduced, fees for letting, a fee when you, the landlord, decide to sell…. rinse and repeat.
The logic for the investor to use said agent is on the face of it, compelling; ease of transaction, pre-existing knowledge of the property, the prospect of dealing with the same people, possibly pre-existing tenants and so on.
However, the question I would pose to all of you who purchased your buy to let a year or more ago in these circumstances is: 'What's your experience been like in practice, did the logic pan out as expected or have you been left feeling slightly disappointed?'
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Perhaps your experience has been really positive, you're really happy with the property you bought, you've now got great tenants and your agent is doing everything they ever promised.
For the rest of you which I would hazard an educated guess is the majority, commiserations! I would wager that generally those in the happy camp purchased via a smaller independent agent?
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The larger agent in terms of their short term financial needs require to have much more of a 'sausage machine' mentality in terms of driving fees and are structured on divisional lines.
So, the sales department will have a different set of departmental targets to the lettings division, probably be on different floors (or not even in the same building) and be driven by personal commissions.
In turn the lettings people are split into different teams, one doing the lettings, one doing the property management, another doing the accounting and so forth.
But its horses for courses isn't it, lots of landlords treat their properties as a personal sausage machine and are only interested in the price they pay the agent and how quickly they can be let.
Ok, so what do you do if you think you're wedded to the wrong agent? Well there's nothing to stop you walking out at the end of a particular tenancy and starting with a new partner but what do you do if the relationship has irretrievably broken down and you need to get away even though there may still be more than several months left of the current tenancy?
An agency agreement can sometimes be a bit like a pre-nup and have buried deep in the small print, provisions for when a 'divorce' becomes necessary.
Some agents try it on by saying you can't move while a tenant they found remains in situ, in my view this is an Unfair Term In Contract and, therefore, would be unenforceable in practice.
My belief is these can be safely ignored. Usually though you'd only want out if the agent wasn't delivering and were in breach of their obligations anyway.
I appreciate though for a lot of people switching agents is a bit like the fear of switching bank accounts.
In the latter case the exercise is regulated and nowadays is a fairly easy process to follow. Switching agents does go better if the outgoing agent plays the game but if the incoming agent is any good, they'll be able to overcome any issues and make the exercise painless.
Mike White, director at Martin & Co Norwich can be contacted on 01603 766860. Martin & Co has sponsored this column.