Fully Managed vs LandLord Insurance

PeterJames123

First time landlord question

Most agents I have spoken to )with good reviews on trustpilot) charge 10% to manage your property. Bridgefords offered my 6% for rent collection only and then said I could get my own landlord insurance for something like £14 a month which will have 24 hour call out for anything such as water / boiler / electrical damage which also includes building insurance. 

I was wondering if that’s was something landlords use a lot as I have heard of agents taking fees for small jobs around the house which are much higher than the actual job is worth and then I would have to pay for that. But I’m not to familiar with landlord insurance 24/7 repairs and maintenance and if it’s actually worth it or just paying the 10%. 

Thank you.  

eddddy

I assume you're talking about "Landlord Emergency Cover". I wouldn't really try to compare emergency cover with property management - they're very different things.

As an example,

If a tenant has an emergency (like a leaking toilet) - the different paths would be:

1. They phone you (if you're managing the property) and you phone a plumber
2. They phone you (if you're managing the property) and you phone the landlord emergency cover people (if you have cover)
3. They phone the agent (if you have a managing agent) and the agent phones a plumber
4. They phone the agent (if you have a managing agent) and the agent phones the landlord emergency cover people (if you have cover)

But check the policy to see what counts as an emergency. For example, things like a leaking shower head, a toilet that doesn't always flush properly, a dripping tap, failed shower sealant, a bath that drains very slowly etc, probably aren't classed as emergencies - so you'd need to contact a plumber in those cases anyway.

theartfullodger

Neither a lettings agent nor landlord insurance will necessarily save you from losses.

To be a lettings agent in England requires no qualifications no training no criminal records check.  

This and other landlord related sites have many tales of woe over insurers wriggling out of paying, usually by pointing out small print punter didn't read.

Done any training in landlord/tenant law &/or how to be a landlord?  If not you are taking a huge risk.  Trust me, I did, expensive, painful, long-drawn-out mistakes.  Oh my stupidity, oh the hubris

Tiglet2

PeterJames123 said:

First time landlord question

Most agents I have spoken to )with good reviews on trustpilot) charge 10% to manage your property. Bridgefords offered my 6% for rent collection only and then said I could get my own landlord insurance for something like £14 a month which will have 24 hour call out for anything such as water / boiler / electrical damage which also includes building insurance. 

I was wondering if that’s was something landlords use a lot as I have heard of agents taking fees for small jobs around the house which are much higher than the actual job is worth and then I would have to pay for that. But I’m not to familiar with landlord insurance 24/7 repairs and maintenance and if it’s actually worth it or just paying the 10%. 

Thank you.  

As a first time landlord, it might be prudent to go with a fully managed service to start off with.  Then a year or two later, think about whether you could manage it yourself.   

Would you mind the tenant contacting you directly when there are maintenance issues?  Are you reasonably competent with DIY?  If so, managing the property yourself should easily be doable.  If not, then during the first year of a managed service, you will need to acquire contact information on local handymen, trades etc, whom you can contact if you need to once you are managing the service yourself. 

You would need Landlord's Building Insurance in any case and the tenant gets their own Contents Insurance (if unfurnished). 

I'm dubious as to how easy having landlord insurance for small maintenance issues is going to be.  If the tenant has a problem with hot water, heating or the boiler, then getting these looked at quickly may well be held up if you have to involve the insurer every time.  

theartfullodger

The tenant is entitled to the landlord's actual address, (easy to find anyway these days) be prepared for a 'phone call or knock on your door, 22:35 Saturday evening, reporting toilet leak onto sofa & sitting room carpet.  Been going for 3 days.

Make sure you have the financial and emotional reserves to copy with all sorts of crisesees, no rent, bent agent, unexpected repairs, tenant-from-hell, can't rent the place out, mortgage interest rates going up.

I had a large mortgage November 1979 under Thatcher's yoke, BoE base rate hit 17 %.

Happy days

chrisw

As mentioned above, go fully managed to start with and that will give you some idea of the demand on your time and resources from your tenants. It also depends on how far away you live.

My tenants have been in for 10 years or so and contact me maybe once every 3 months. Even then it's rarely an emergency, but even if it is, I can find the time to nip round and have a look and either fix it or get someone in.

dimbo61

Be careful what you sign with any Letting Agents.
Read every single word of the contract.
The Buck stops with you as the Owner and Landlord.
Lots of things to make sure you get right before you even look at buying/renting out an property in the UK.

canaldumidi

Property management by an agency, LL's building insurance, and emergency cover (for gas,plumbing etc) are 3 completely different things.

Your misconceptions suggest you need to do a lot more research before taking this decision. Read

Post 7: New landlords (1):advice & information :see links in next post

Post 8: New landlords (2): Essential links for further information

Post 9: Letting agents: how should a landlord select or sack?