- Real Estate
How To Become A Letting Agent Or Real Estate Agent
Letting agents or real estate agents both market properties for their clients and act as negotiators between them and their tenants. The agency makes their money by charging a commission for each property they successfully let. If they are also responsible for the management of that property for the duration of the tenancy then they will normally take a percentage of the rent as a fee. They deal primarily between tenancy agreements between private individuals and landlords rather than commercial premises. If you want to become a letting agent you may also train as an estate agent owing to the great similarities between the two professions.
A typical day for a letting agent would be pretty varied and requires a large skill set. Part of their job involves viewing potential rental properties, taking photos and measurements to assess the rental yield. They also need to advise clients on the rental process and liaise between them and tenants to ensure that tenancy agreements are drawn up properly, deposits are paid and credit checks are carried out.
A letting agent will also need to market rental properties through various channels including online or local papers. Once the tenant is installed, they may well have to deal with complaints regarding the property or arrange for maintenance to be carried out, as well as collecting the rent for the landlord. Most agencies will also carry out regular property inspections to check the tenant is holding up their end of the agreement. Basically, as a letting agent you would normally be based in an office but also spend a lot of time out an about too. This would suit somebody who doesn’t want to be chained to a desk all day.
As you may imagine from the above job description, you need to have certain skills and characteristics in order to do well. To begin with, it’s essential to be able to engage with people and have excellent communication skills as a large part of your work will involve liaising with clients. You will also need to be able to deal with people from all backgrounds. Also, patience and diplomacy are required as you will no doubt have to deal with difficult landlords or tenants from time to time. Added to this, you should have a strong business sense and interest in the property market, allied to organisational and time-keeping abilities. Finally, given that the properties on an agency’s book may be spread over a wide area, a full driving licence is pretty important.
Working hours for letting agents tend to be around average – you would normally work around 35 to 40 hours a week full-time. Part-time work is often available as well which makes it a solid career choice for those who want to pursue other avenues or have to juggle childcare with work. In terms of income, you would normally earn a basic salary but as the job of a letting agent is often combined with that of estate agent, this will be topped up with commission depending upon how successful you are. Starting salaries will normally be around the £15,000 mark, but this will increase with experience.
You may have aspirations of setting up as a letting agent on your own one day, but to really learn the business you should always start out in an established company. To get a job as a trainee letting agent you may be pleasantly surprised to learn that you don’t necessarily need huge lists of formal qualifications. Your potential employers will be more interested in your people skills, sales skills and whether you have had previous experience of working with the public.
Many people even start as administrators in an agency to get their foot in the door and then work their way up from there. Have a look at which trainee or apprenticeships schemes are available in your local area. Once you are in the job you will have the chance to gain industry-recognised qualifications such as National Federation of Property Professionals technical awards. If you ever decide that you want to set up on your own, there is some excellent property management software out there these days to help you run your business efficiently.
Starting A Property Portfolio
You may be surprised to learn that anyone can become a property investor these days. Unlike training to be an estate agent, it doesn’t require any special qualifications. Having said that, if you are seriously thinking of exploring this field you do need to have a good strategy in place and you need to know how to manage money effectively. Investing in and letting property is a great way to set yourself up for the future. Here are some steps you need to take and tips to follow to make sure you’re going about it the right way:
Market Research: Do you know anything about the buy-to-let market? If not, it’s time to familiarise yourself with it before you even think about buying any properties. Check out the latest news from online buy-to-let websites. On these you will be able to find out information such as where to get the best rental yields and where the best buy-to-let deals are. Your research should help you decide whether this is really what you want to do, bearing in mind that it will involve tying up your capital for quite an extensive period of time.
Getting Finance Right: Before you go and look around any properties you need to do your maths. Sit down and write down the cost of houses you are looking for and the likely rental yields you will get. How much leeway do you have if the house stands empty for a couple of months whilst you’re looking for tenants? Do you have enough money coming in from other sources to cover repairs and maintenance?
Once you have worked out the feasibility of starting a property portfolio you can shop around for mortgage deals and hopefully get something that will allow you to break even to begin with or even make a profit. You need to take your time and talk to as many lenders as possible so you are certain you’ve got the best rates.
Location: Find some promising areas to look at and this will help narrow your search for viable properties. This does not necessarily mean the most expensive or cheapest, but simply those that are appealing for tenants. Proximity to transport hubs can be a bonus, or if you are letting to students then you need to find out which areas they will tend to gravitate towards. If you would prefer to let to families, are there any particularly popular schools nearby? This is important because a lot of parents will choose a house solely to get into a certain catchment area.
Choosing Properties: The type of properties you go for will depend upon the demographic you are targeting and whether you want to spend time doing them up or let them right away. If you buy them new or nearly new then you won’t have the hassle of having to re-fit bathrooms, kitchens etc. If you want long-term tenants then go for two- or three-bedroom houses and try and let to families who will be more likely to want to settle. If you go for smaller place or let one-bedroom starter homes to young people you will more than likely find that they want to move on fairly quickly – potentially leaving you out of pocket if you can’t find a new tenant right away.
Managing The Property: You will need to decide early on whether you want to be a hands-on landlord or whether you want to hand the property management over to a letting agent. Some people prefer the latter either because they don’t want to get too personally involved with their tenants or they don’t want to have to worry about the day-to-day problems of renting out a home. The benefit of the first option is that you will get to keep more of your rental yield and you can keep a closer eye on your tenants and the state of the property.
However, if you’re going to do this you should probably invest in some good property management software to help you keep on top of things. This will help you control your portfolio by integrating functions such as automated letters to tenants, recording transaction details, accounting and reporting.
Know The Risks: As with anything you do in this life, you should be well aware of the potential pitfalls of getting into the property business. Remember that house prices may continue to fall, and if this happens you could struggle to hold onto your investment. Also, bear in mind that things can always go wrong with a property and repair bills can be substantial. You can’t go into this without a bit of capital behind you to cover maintenance or times when the house is sitting empty.