Insider Tips; The Benefits of a Rental Agent
Category Market Advice
Investing in rental properties in South Africa's most prosperous province, Gauteng, can bring in lucrative monthly income, provide a stable retirement plan and build long-lasting wealth. The benefits are extensive, and this has resulted in a growing number of everyday homeowners purchasing a secondary property with the purpose of keeping it tenanted (buy-to-let).
Although there are many benefits, one of the biggest deterrents for owners is the possibility of getting bad and unruly tenants. Yes, this is a cause for concern that has, in fact, seen a spike in the last few years. According to the recent Tenant Profile Network (TPN) Rental Monitor report, the percentage of tenants in "good standing" has decreased from 85.95% in the third quarter of 2014 to 82.77% by the first quarter of 2017.
This statistic may discourage even the riskiest buy-to-let investor, however, there is a silver lining. According to Nicolle De Lucia, Principal real estate agent at De Lucia Group, there is an almost foolproof way to protect yourself and your investment.
"The buy-to-let market is set to grow in the future as more and more people choose to rent homes instead of buy as this is more flexible and affordable in the short-term.
"And because of the tenant pool growing, ordinary homeowners are seeing great potential in investing in property to rent out in order to generate a secondary or even primary income."
She says the biggest mistake these investors make, especially the ones starting out, is embarking on the process alone, without expert guidance.
"With any venture, risks do exist, but a large part of this can be avoided if an owner employs the expertise of a rental agent who understands the ins-and-outs of the industry and is qualified and professionally trained to handle every aspect of it."
De Lucia goes on to explain that a rental agent performs various key tasks - from selecting a good tenant to undertaking pre- and post-occupation property inspections.
"Let's unpack this a little further."
"One of the most important tasks implemented by the appointed agent is to find a good and reliable tenant with a positive track record.
"To achieve this, the agent will perform full background and credit checks on a shortlisted number of candidates, while also checking their work history in order to identify the best and most-suited tenant."
"Once this is finalised, they can provide the owner with a drawn up lease agreement for the tenant to sign - this is an important part as this legally binding document sets out the rules and regulations for the owner and tenant in relation to the property.
"Furthermore, it offers protection for both parties and provides clear criteria for rental payments, collections and increases, deposits, maintenance issues and damage claims."
De Lucia adds that it is also the agent's duty to explain the terms and conditions to ensure that it is clearly understood.
Other duties of a rental agent, says De Lucia, is the collection of a rental deposit from the tenant, which is used as security in the event of damage to the property. The agent will keep the deposit in a trust and it is paid back to the tenant if there is no damage incurred.
"Although rental agents are a great asset to owners, they are also invaluable to tenants as they act as a guiding light in all aspects of the rental procedure, including explaining the laws around renting a property and their rights and responsibilities.
"Of course, there are many more aspects around buy-to-let property for both the owner and tenant, but it is important to speak to the right agents with a good reputation and enough experience in this market."
With over 40 years of experience in Gauteng's property industry, De Lucia Group has evolved into a leading agency in both sales and rentals. We have a designated team dedicated to rentals who will help you navigate this sector with knowledge, know-how and professionalism.
Speak to us today to find out more.
Author: De Lucia Group