Alternative to licensing/accreditation? Bad landlords, look away now!

Reply to the comment left by "Steven Burnell" at "13/09/2013 - 23:14":

Good points Steve, take a look at the rant from John Gell and his thoughts on regulation North of the border. Link below 🙂

P.S.
As a newbie, I could be persuaded to register if a letting agent told me I'd get an extra £25 pcm (~5%) & let even faster to the very best tenants if my property got X Stars (of which they were very confident in it achieving).

Reply to the comment left by "Mark Alexander" at "13/09/2013 - 23:22":

Agreed with thrust of his argument. They should ensure that letting agents are well qualified & regulated like other professionals working for us e.g. accountants, solicitors, & IFA's.
Not so sure they can require same of small, part-time landlords who more often as not rely upon those very same letting agents.
However, if letting agents were robustly regulated then they could give every landlord an option: must use a regulated letting agent or must be personally accredited by the likes of NLA?
Legitimate tenants will then just go via regulated agent or with certified 'corgi'-type landlords & any direct payment of LHA would only go via this route too. Indeed, I don't know if / why the likes of the NLA aren't signing up local councils to these benefits?

Reply to the comment left by "Steven Burnell" at "13/09/2013 - 23:32":

And that's exactly what we intend to build the situation to...when we launch, and until the track record is there for comparison of our star ratings and the rents they are achieving, we will of course have to charge much less for the surveys. So I can promise you that £25 pm over a 2 year period is way way way over the cost of what we'll be asking for a rating survey.

In fact, and for those readers that are reading this thread with interest, you deserve a reward, so here's an exclusive piece of information for you....the first 30 surveys we book will be £25 EACH. That's £25 for a rating which lasts 2 years.

After that, for pre-launch booking (which we will take for around 4weeks before we launch) the prices will go up gradually as more people buy, until we hit our launch prices. Which will still be a lot less than we'll charge when we have more market presence.

So if you like the idea, the key is to get in early to get yourself a bargain! Don't worry I'll be announcing the dates (on here too) very shortly.

Reply to the comment left by "Steven Burnell" at "13/09/2013 - 23:14":

As far as we can see, no other country has anything like this. But I think the UK PRS has evolved differently to other countries.

I know in Germany a lot of the housing stock is owned by housing associations & municipal authorities. And the tenants' associations seem to be a lot stronger over there too, so if there's a problem with the landlord and/or quality of the rental property, they have more immediate support to resolve it. (I know we have these things, but our tenants don't seem to be as aware of how to deal with complaints..take "Hannah" for instance on a previous thread, and countless other tenants I know about from my MD's experience.

What's even more frustrating for him, is that because he's there on behalf of the insurer, and the customer is the landlord, he can't tell them what they should do. And they live in fear of losing deposits all the time. It's scandalous.
Anyway, I've gone off on a tangent...no I don't think the star rating exists in other rental markets, because they operate differently. Although if anyone knows different, please let me know.

We are in the very early stages of talking to a local authority (not Newham) about how they treat our star rating. That would be fabulous though wouldn't it?! Direct the resources where they are most needed.

Reply to the comment left by "Steven Burnell" at "14/09/2013 - 00:13":

Wow you guys have much more stamina for late night chats on forums than I do?!! Sorry I'm just replying to all the previous comments all at once now I'm catching up.

Just thought it was worth letting you know about the accountancy market as you seem to think that accountants are all regulated. Actually they aren't. Only a registered auditor needs to be regulated by one of the major institutes (ICAEW, ACCA are the main two) but a company doesn't require an audit now until they have turnover of over £6.5m (that's a rough guideline, there are other considerations). That's pretty big and generally equates to c.150 employees perhaps? 99% of businesses in the UK have less than 50 employees according to govt stats.

So most accountants that do your tax return and accounts, even if you are limited company, do not NEED to be regulated.

The reason most are regulated, is historical. This audit threshold didn't exist until late 90s and until 1994 all accountants had to be regulated. So may it change...probably and (like ARLA etc) it's up to the Institutes/trade bodies to keep their marketing/visibility so high that most business owners don't even know this is the case though.

What I can tell you is that ICAEW are much much stricter on quality control and dealing with complaints from clients, than I've noticed the regulatory/trade bodies are in the lettings/property industry. But I guess business owners are generally more vocal and empowered than your average tenant.

Thanks for all the comments & thoughts on here - you really helped me stress-test it!! We are now rolling out the launch of Rental Ratings & I've put a new thread up with more information about what we've ended up with.

I like the idea behind your rating system and I know how we can use it in our own business model.

How truly independent is the rating? Can the "raters" be influenced and will spot checks be carried out to ensure that another rater will give the same property the same rating?

Reply to the comment left by "Dunsaw " at "20/09/2013 - 10:20":

Hi Dunsaw - great question! Yes, they are absolutely 100% independent. We have recruited incredibly experienced individuals, vetted them and then further trained them all ourselves - in fact their 3rd day's training course is coming up this weekend & next.

We have built in procedures to our system so that we can review their work and remotely assess the reasonableness of their judgments (although, to be honest, most of the rating areas are factual, and there's no judgement call required at all).

Plus our MD will be quality checking and working alongside each surveyor on a rotating basis, to ensure further quality controls.

Hope that puts your mind at rest. Do email me if I can help any more.

Reply to the comment left by "Mark Alexander" at "13/09/2013 - 23:10":

I agree with Mark's comment on embracing this concept.

What is wrong with a landlord's property scoring only 1*? I look at it as the landlord wanting to improve his property and has made the first step toward so doing.

If Kirsty's rating report can also list what a landlord needs to do to take his property to the next * rating, step by step, we will all get to where we want or need to be. I will rent a 1* property if the landlord told me that over the next 6 months he intends to get to 2*. Whilst renting the property I can monitor if the work needed has been done. If he does not keep his word I will be moving on and letting the rating agency know!

For me getting any * rating shows a mindset that says "I want to know where I am at and see how I can improve the property that I let out". If my target tenant is 3* then I want to ensure that all my properties are bench-marked at 3* minimum.

Kirsty can you offer 1* properties a discount for a "re-grading" if for example, they carried out your suggested "upgrades" within 6 months?

Overseas students can use this rating system to seriously consider a property before coming over so Student Landlords think about it. Some parents are buying new build flats for their offspring before the children ever set foot in the UK because the parents cannot guarantee the standard of accommodation offered in the UK or that the property even exists!