In today’s fast moving environment it is vital that lettings businesses are both fully compliant with the myriad of legislation affecting the sector and are maximising the commercial opportunities available, particularly as commercial pressures and legislation are impacting significantly.
Tenant Fee Act
Research shows that letting agents saw, on average, around 15% of total revenues disappear when the tenant fee ban came into effect on June 1st 2019. This is clearly significant and potentially devastating. Replacing revenues, cutting costs, developing new propositions is vital. Change is always challenging to manage and takes time - so don't delay - get on the case now - the Lettings Health Check will identify strengths, weaknesses, opportunities and threats for you to action.
Many clients that I work with have actually significantly increased their fee income having made changes following the tenant fee ban.
Client Money Protection, Energy Efficiency, Electrical Safety Regulations and Fitness for Human Habitation
It became mandatory from April 2019 for letting agents to have CMP (Client Money Protection) in place and from April 2020 for all rental properties to have an energy efficiency rating of E or above. It is proposed that this becomes a minimum C rating from 2025.
In addition, the Fitness for Human Habitation Act became law in 2018 and July 2020 saw new electrical safety requirements and the provision of safety certificates needed on all residential lets.
These requirements are mandatory and require complaince but they also present excellent commercial opportunities for agents and property managers.
Undesignated Client Accounts
Recent years has seen growing pressure on letting agents from banks in regards undesignated client accounts. Many agents have had the threat of having these accounts closed which would effectively put their lettings operations out of business.
We have considerable experience of successfully working with clients on their compliance and systems to avoid the banks taking such Draconian action.
Ombudsman Code of Conduct - Referral Fees
To coincide with the Tenant Fee Act, The Property Ombudsman introduced a new code of conduct which makes it a mandatory requirement for agents to disclose any referral fees, commission or other "secret profits"
National Trading Standards have made it clear that they will use Consumer Protection Regulations to prosecute agents who fail to comply.
As well as a review of the entire lettings business operation, we will undertake an audit of a selection of property files to ensure compliance with legislation, regulation and codes of conduct. This will involve a detailed site visit as well as desktop research.
We will also undertake a review of current products and services, fees and commissions and highlight areas where practical opportunities exist to increase revenues, reduce costs and increase margins.
Failure to comply with lettings legislation could have a devastating effect on a business and its owner(s) with failures in some areas carrying significant penalties including fines and imprisonment. In addition, shortcomings could result in compensation payments and awards being levied through the courts or redress schemes or an inability to enforce terms of business and secure fees.
Good business practice is vital but does not exclude ensuring that the business maximises the commercial opportunities that exist from a well-delivered portfolio of services and products.
If you are operating a lettings business you need to ensure compliance and good business practice, whilst not missing out on fee earning opportunities, and that is where The Lettings Health Check comes in.
The Lettings Health Check is a detailed audit of your lettings business concentrating on compliance and commerciality.
The Lettings Health Check can be offered as two separate sections - compliance or commerciality - or at a reduced collective cost, the full report.
Each Lettings Health Check will result in a detailed report and draft business plan that the business can use as a template for improvement.
The Lettings Health Check could be the best investment you make in your lettings business - to discuss further or to book a Lettings Health Check – please call or email us at email@example.com.
We look forward to being of assistance to you.
The Lettings Health Check will be undertaken by Michael Day MBA FRICS FNAEA FARLA
Feedback from Rampton Baseley
We engaged Mike to do a full Lettings Health Check for our business.
I had been to several of Mike’s seminars over the years and always liked what I’d heard; a clear, professional and easily transferable distillation of agency regulations and law. So, after attending one of these recently, I engaged him to have a look at our lettings business.
Mike spent a good two days analysing and reviewing our protocols and practices, and then gave a comprehensive, and perhaps more importantly, comprehensible report on his findings.
All delivered in a matter-of-fact and personable manner. Invaluable.
His report gave us direction and detail which we will integrate in our business over the coming months.
I would consequently highly recommend the Lettings Health Check to any agent, a good value and profitable investment.
Patrick Rampton - Director
We engaged Michael Day of Integra Property Services to carry out a Lettings Health Check of our business and this was undertaken in August 2018.
Michael attended our offices and spent a full working day interviewing staff, auditing files and company procedures. He also undertook some desktop research and looked at much of our documentation and reviewed our website. In addition, he looked at our current commercial arrangements in regards supplier agreements, and the fees and charges, revenue and profit from ancillary income streams.
We subsequently received a very detailed but easy to digest report from Michael that highlighted his findings and made 112 recommendations and provided a template business plan for future action.
The recommendations ranged from a couple of essential compliance matters to a number of commercial business opportunities and we have subsequently reviewed and put in place a programme of improvement. As well as helping us “de-risk” our business and ensure compliance with the myriad of legislation, we believe we are much better placed to generate greater volumes of business and greater revenues which, given the impending tenant fee ban, will be essential.
My business partner Darren, myself and all the staff were delighted with the positive and solution conscious approach taken by Michael and feel that our business is in a much stronger position as a result of having invested in an independent review – the Lettings Health Check.
Chris Harper - Partner
As an independent firm of Chartered Surveyors, we were seeking a professional third party objective overview of our Lettings business to assist in forming its future strategy.
Michael’s approach was thoroughly professional, helpful and informative and his advice and report subsequently given certainly achieved our initial objective.
Since his visit he has remained readily available for further discussion and we continue to implement a variety of his recommendations. We would not hesitate to recommend Michael’s services.
Kate Trewhella - Partner
We have been using Michael Day & his company for regulation compliance & business planning for a number of years now and he recently completed a very detailed Lettings Health Check for us.
This resulted in us making a number of positive changes to our operation. Michael is always very knowledgeable, informative & helpful to all of us at Frank Schippers Estate Agents and we would have no hesitation in recommending him.
Frank Schippers - Proprietor