Property Investment Company – What You Need To Consider BEFORE Hiring One

If you have money to invest in the property market but very little spare time to research available properties and their locations then it may be worth hiring the services of a property investment company. These companies aim to make property investment a breeze, but you’ll quickly find the range of services provided vary quite considerably from one company to the next.

So which property investment company do you choose, and how do you know they will always have your best interests at heart?

Do they offer a full service?

A property investment company that offers what is termed a ‘full service’ will include the following in their fees:

  •  Help to locate suitable investment property opportunities
  • Help with the administration side of a property purchase
  • Letting agency services i.e. advertising the property, vetting potential tenants, performing credit checks, taking and registering tenant deposits etc.
  • Property management services i.e. on-going management of the property as a private rental property.

In other words they source, purchase, let and manage your investment properties for you, so making you an ‘armchair’ landlord.

Unfortunately it is quite rare to find a property investment company that offers a full service, and more commonly you’ll find that the company sub-contracts the letting and management side out to associated businesses. While this isn’t necessarily a bad thing it can make things awkward if something goes wrong with the tenancy or the property itself, as the property investment company can say the problem isn’t theirs but at the same time so can the sub-contractors.

Do they actually view the investment properties they suggest to you?

You may think that as a property investment company the company you’re dealing with will in fact take the time to visit the properties they suggest to you…but sadly a lot don’t. What they do in fact do is use the estate agent description or the auction catalogue description to make a judgement on the suitability of the property as a buy to let investment.

A lot of companies also fail to fully research the local area and the amenities it offers e.g. schools, doctors, shops, supermarkets, public transport links etc. While this may seem like a small oversight it can lead to disaster as a private landlord. For example, let’s say your property investment company fail to research the trends of area you’re interested in and mistakenly suggest a BMV one-bedroom flat in an area that is known to be popular with families.  As a direct result of their suggestion you buy the flat, not knowing that your new investment property is going to be virtually impossible to rent out for the rental price you have in mind.

With this in mind make sure the property investment company you hire thoroughly researches every aspect of a property before they suggest it as a potential purchase. Ask for the results of their research and the notes they make when they visit the property. This way you’ll know that any property they suggest to you really is a good investment and not just a way to boost their commission for the month.

In conclusion

If you are considering hiring a property investment company to work on your behalf make sure you research them as well as you would want them to research potential investment properties. You should also find out from the start exactly what services they provide and make sure their fees reflect the effort they are going to put in.