Taking the risk out of renting property

Website TrustedLets said it took a good long look at the rental market to uncover some of the practices and behaviours that seemed to dominate and came up with some interesting findings:

1 The vast majority of landlords and tenants behave responsibly and professionally. For example the recent Government Response to the Rugg Review stated "in 2006 three quarters of all private tenants were either very or fairly satisfied with their landlord".

2 Renters (both landlords and tenants) tend to treat each tenancy as a one-off transaction and there is no track record on how previous tenancies have run. Landlord references can be unreliable as the "old" landlord is keen to offload a bad tenant and knows a bad reference will delay things.

3 The motivation for both tenant and landlord is to maximise their short-term gains. This might mean not repairing a property as every pound spent on repairs is a pound less in income or withholding the last month’s rent prior to leaving. Without any external motivation, the relationship after signing the tenancy can quickly degenerate as every incident is viewed through a prism of "how do I make the most or lose the least out of this situation?"

4 The lack of transparency in the market means that renters can be "serial offenders", without much risk of exposure. There are millions of landlords and millions of tenants; the chance of a new one meeting an old one is slight.

5 Estate agents work solely in the interest of the landlord, yet are often paid by both landlords and tenants.

6 There is a perception that tenants and landlords introduced by an estate agent are more reliable than those found through advertising directly. The difference is actually how applicants are vetted, rather than whether or not this is done by an estate agent.

There have been initiatives by successive governments, local authorities and trade bodies to try to reduce the risk for landlords and tenants. There are also companies who provide services such as credit checks, codes of conduct and insurance policies to try to reduce the risk.

TrustedLets believes the success of these approaches is patchy; for example, a tenant might have an exemplary credit rating, however if they lost their job they wouldn’t be able to pay the rent.

TrustedLets said the company was established to try to change some of the behaviours and practices in residential letting that were at the root cause of the problem.

It designed a website to enable landlords and tenants to establish and build their reputation in a way that didn’t take too long and which secured their personal data.

The true innovation behind TrustedLets is a unique landlord/tenant rating. Landlords and tenants have to both agree to exchange a rating and can rate each other once every three months of a tenancy.

To visit TrustedLets click here

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