Landlords - watch out for that clause!

As we enter Fresher's Week and the streets around University Avenue and Byres Road turn to a scene from Mash. Watch out for those yellow t shirted pied pipers leading hapless freshers through a week of debauchery. There is no life of Riley for landlords out there at this time of year however. September is a busy time with the pavements turning to gold as they have the pick of tenants to fill their properties. But watch out landlords! - you need to be wary before you sign that agency agreement with the letting agent if you are not letting to students!

The student letting market runs like clockwork on the likelihood that your tenant is going to scarper after 12 months. Unlikely that you will get a stayer who wants to end up buying the property. If however you are in the long term letting market then be aware that alot agents out there will have a sneaky little clause that will leave you asking the question when is a letting not a letting agent. Many a letting agent wear estate agency clothing when the tenant wants to buy the property from the landlord. Most agency agreements allow the letting agent to take a percentage of the sale price if you sell the property to your longstanding tenant!

I have had many a client not realise that this clause existed when they accept the offer from the tenant only to discover that they have to shell out part of the price back to the letting agent. Now I am not going to go into the why and wherefors as to this practice. Suffice to say that if you are a landlord, you should be having a discusion with your letting agent before you sign the agreement about revising that clause if you do not want to be caught out once that offer lands.

As ever forearmed is forewarned!