Residential property landlords have faced tough conditions over the past three years due to the COVID-19 pandemic and resultant economic downturn. Encouragingly, the most recent PayProp Rental Index reports a return to rental growth to pre-pandemic levels. The average national rent increased by 3.4% from Q4 2021 to Q4 2022.
Michelle Dickens, CEO at PayProp, says appointing a qualified property professional is critical to help buy-to-let investors navigate 2023’s changing rental market. “A professional real estate agent is able to give an owner peace of mind when it comes to understanding market trends, adequately dealing with tenants and making sure that every Rand is accounted for.”
But the market for rental agents is competitive, and property owners will naturally weigh up their options carefully when their investments are on the line. How can agencies make sure that they stand out from the crowd?
1. Adequate accreditation
A property professional is required to be registered with the Property Practitioners Regulatory Authority (PPRA) and have a valid Fidelity Fund Certificate (FFC). Investors can and will check with the PPRA about the regulatory status of your agency if they’re in any doubt. Compliant, professional rental agencies will have these registrations in place and can provide them when asked.
2. Professional systems
Financial management is one of the most important parts of rental property management, but some agencies are still using a combination of Post-it notes and spreadsheets to manage property finances – leaving landlords frustrated as their rental payments arrive late, or worse, not at all.
Having an advanced FinTech platform like PayProp, which plugs directly into the SA banking system, means you can assure landlords that their funds are managed professionally, safely and with maximum transparency. FinTech doesn’t just make rental payment admin faster, easier and more secure, it can also be a huge selling point for investors.
3. Offer a transparent mandate
Not having a detailed mandate of management activities in place is a massive risk for any owner. Ensure that you have a document that outlines exactly what your agency can and cannot do, and exactly what the landlord must pay in return.
4. Non-negotiable ingoing inspections
Cutting corners on inspections might save you valuable time, but it can leave your investors facing big repair bills. If an ingoing inspection report has not been done, landlords are not able to claim for any damage from the tenant when they leave, as no baseline exists for the condition of the property.
Having a clear policy on inspections, including ingoing and outgoing checks, helps reassure landlords that they’re working with an agency with their best interests at heart – especially if they’ve been burned before.
5. Go above and beyond on tenant screening
Many agencies will perform a credit check on prospective tenants, but a credit check only tells you whether the tenant can afford the rent – not whether they have a proven propensity to actually pay it. If a tenant that you helped choose decides not to pay, it can seriously damage your relationship with the landlord – as well as your commission income.
Better screening processes don’t just look at a tenant’s credit score, they also take into account rental payment behaviour. PayProp’s unique Tenant Assessment Report uses PayProp platform data to show you whether or not that applicant pays their rent on time and in full.
If you have an advanced screening system in place, make sure that you advertise it. Landlords will love the peace of mind that it brings.
In conclusion, Dickens says that professionalism, transparency and best-in-class FinTech will make all the difference when canvassing for new landlords.
“Property professionals keep investors abreast of trends in the private rented sector which is continually influenced by political and economic factors. Added to this, it’s critical to have the systems and resources in place to manage investors’ properties professionally.”
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