Residential property company homes4u has reported a substantial increase in investor enquiries, signalling the property market is getting back on its feet.
But at the same time the Manchester-based company is calling for caution among those new to investing, following an increase in the number of ‘property investment companies’ charging unnecessary fees and pushing deals with hidden costs and terms and conditions.
Carolyn Mellor, Managing Director at homes4u, said: “Entering into investment deals can be very complicated so it’s hugely important that investors know what they’re getting themselves into and are aware of the potential risks of not thoroughly investigating the deal for hidden costs and fees.
“Many who have come to us have encountered deals where the investment company has asked for fees for ‘courses’ or for the opportunity of accessing their portfolio of property for sale.
“We’ve also seen many getting caught by unexpected ‘tied-in’ services such as financial advice, insurance and furniture packages. Investors should check whether this is the case before they commit to anything.”
Mellor advises potential landlords speak to an experienced property management company to avoid unnecessary costs and to have industry jargon properly explained.
And homes4u has suggested a list of ‘Top 10 Questions’ buy to let investors should ask of their agent, to help guide them towards solid, secure investments.
Mellor claims the top 10 questions are:
- How long have you been letting and managing property?
- How many specifically property management staff do you have?
- How do you manage the tenancy deposit process?
- Are you members of the Property Ombudsman scheme?
- What is your arrears rate and managing procedure?
- How many visits does your website get?
- How many properties do you let a year?
- What are your fees and charges? Do you charge additional fees for inventories?
- Do you have a 24-hour emergency number? If so, who answers the calls?
- Do you manage and let any of your own properties?
Mellor concluded: “Property investment can be a real minefield and it’s a fulltime job keeping on top of everything.
“Investors need to consider how they choose the best agent to manage their property and assist them grow their portfolio.”
