- Original Poster
- #1
Considering starting a letting agency business. I know there's a pretty low barrier to entry in terms of setup costs, but our differentiator will be being based online and having most of the management self-service or automated, reducing workload and allowing us to offer much lower fees to landlords.
Most traditonal letting agents have expensive and are quite old-fashioned (phone to report problems, expensive and commission based etc.), I also don't see letting agents being revolutionized the same way estate agents are with the rise of online ones.
For example, we will offer two packages. Self-listed, which gets you on the listing sites such as Rightmove etc and we'll handle any inquiries or users of our site/app may contact the landlord direct.
Then there's fully-managed which does what it says. We'll fully manage the property like a high street letting agent but with a lower fee than one would typically charge. Most charge around 8-10%, whereas I can turn a decent profit on £50 per month at a flat rate + a £300 one-off setup fee. On top of this we can also sell 'extras' such as cleaning, EPCs, viewings etc.
We could also offer an insurance policy to tenants where for an extra monthly fee of £xx we'd guarantee to the landlord damage from pets would be covered, in an effort to solve the shortage of pet-friendly lets.
The way for us to reduce costs would be no fancy branches and a tenant app where 90% of issues can be reported. Inspections can be done via photo and very little would need to be done face to face.
I think the lower fees would be attractive, especially in my local area where old expensive agencies dominate but would it be a slow burner? Looking for someone who works or has worked in the industry really for advice.
Most traditonal letting agents have expensive and are quite old-fashioned (phone to report problems, expensive and commission based etc.), I also don't see letting agents being revolutionized the same way estate agents are with the rise of online ones.
For example, we will offer two packages. Self-listed, which gets you on the listing sites such as Rightmove etc and we'll handle any inquiries or users of our site/app may contact the landlord direct.
Then there's fully-managed which does what it says. We'll fully manage the property like a high street letting agent but with a lower fee than one would typically charge. Most charge around 8-10%, whereas I can turn a decent profit on £50 per month at a flat rate + a £300 one-off setup fee. On top of this we can also sell 'extras' such as cleaning, EPCs, viewings etc.
We could also offer an insurance policy to tenants where for an extra monthly fee of £xx we'd guarantee to the landlord damage from pets would be covered, in an effort to solve the shortage of pet-friendly lets.
The way for us to reduce costs would be no fancy branches and a tenant app where 90% of issues can be reported. Inspections can be done via photo and very little would need to be done face to face.
I think the lower fees would be attractive, especially in my local area where old expensive agencies dominate but would it be a slow burner? Looking for someone who works or has worked in the industry really for advice.
