Renting a Property in the UK Tips for the Unwary Expat

Renting a property in a new country can be a daunting job for most expats. Even if you’ve rented at home, the procedures here can seem confusing, and sometimes just plain awkward. Craig Vassie, Managing Partner at The Relocation Bureau, takes a tongue-in-cheek look at some of the problems and pitfalls that expats can, and do, experience in the UK.

 House Hunting?  A Walk In The Park . . . . .

The biggest problem with the UK rental market is finding a property to rent. At first glance it seems incredibly easy – there are realtors (we call them estate agents) on almost very street corner, web sites galore, and adverts everywhere. What could be easier? Well, once you get started, you’ll realise that everything is not as rosy as it might seem. That idyllic mews house that looked so nice on the web turns out to be next door to a pub, with noisy drinkers spilling out into the mews every summer night, and the spacious apartment that the agent described in such glowing terms isn’t even large enough to house your dog!! You can spend days and days wasting your time looking at places – so what’s happening? Where did you go wrong?

Let’s go back to basics. The first thing to mention is that the UK still has an almost completely unregulated housing market. Anyone can set themselves up as an estate agent and can then start dealing in rental property. “Great!! That’s free enterprise!!”, you say. You’re kidding me! In practice it means a fragmented market, with widely varying standards of competency, and frequent poor service. In places like Central London, where the pickings are richest, it means that small estate agency firms come and go with monotonous regularity.

So Rule Number One is that old one - “Caveat Emptor”. Don’t be fooled by that stiff Brit upper lip and the smart accent,  if you’re house hunting yourself, then ensure that the realtors that you’re dealing with are knowledgeable and competent. Their firm should ideally be a member of a professional body such as ARLA (Association of Residential Letting Agents), or the NAEA (National Association of Estate Agents). If they’re not, then wonder why. Don’t accept poor service – you wouldn’t accept it at home, would you?

Remember that agents make their living out of commission on deals.  So Rule Number Two is another old one – “There’s No Such Thing As a Free Lunch”.  Put simply, an agent will only ever show you those properties on which they can make some money.

How do you house hunt, then? Well, there’s no Multiple Listing Service, and many web sites are often out of date, so it makes sense to contact as many agents as possible. In Central London, I’d suggest calling or emailing at least 20 agents, and getting hold of their current rental lists. Ask for the full address of anything that you’re interested in, so that you can check it out on a map. Speak to an agent who’s been to the property, and who can give you as much information as possible over the phone. Build your shortlist, and then make your viewing appointments. Sounds like hard work? Then use a Relocation Agent. A Relocation Agent is a search specialist who will charge you, or your company, a fee for the work they do. As part of this job they will source properties for you, advise you on price and negotiate for you. In some cases, the amount they save you will more than cover their fees. I might be biased, but using a relocation agent is a great option to devoting a lot of your own time and energy.

Found Somewhere? Lets Do The Deal . . . .

You found somewhere? Well done!! Got a backup in case it goes wrong? Oh, well!! Good luck in putting the deal together then!!  Where do you start?  Well, Rule Number Three is that “Everything’s Negotiable”.  Well, in theory it is anyway. In Central London it almost always is, but the more provincial you get, the more you run into estate agents who have what we call an applicant mentality, and who for the thirty years or so that they’ve been in the business, have always viewed tenants as poor underprivileged people who can’t afford to buy! With those guys, expats really are from Mars, and CPD (Continual Professional Development) is some form of alternative therapy. If you want the place, you’ll just have to bend and do it their way. Back to reality . . .

The first thing to do, if you haven’t already done so, is to go back to the property for a second viewing. Walk through room by room. Look at the condition of everything, and decide if it’s acceptable, or if it needs work. If it’s furnished, is there everything there that you need, or too much? Make a list of everything that you want done. If you’re bringing your own stuff, measure up and check that it will all go somewhere – this is a tiny island, and that’s why Fisher-Price makes our washing machines!! If you need broadband, then check at this stage that it’s available – don’t just assume so.

When you make the offer, the agents won’t just want to know how much, so be ready with your answers. You’ll need to know whether the tenant will be you, or your employer, for example. What start date are you proposing, and what length of tenancy are you looking for? What work might you want doing – here comes that list, and do you want any option for early termination, or any options to renew? On what terms?

When it comes to money, Rule Number Four is “Be Realistic”. If you’ve done your homework thoroughly, you should have a good idea of what the market is like, and what the property is worth. Place a sensible offer that won’t have the agent rolling off their seat laughing! It might seem obvious, but then also don’t be tempted to pay more than you think a place is worth just to get the deal done – you’ll kick yourself every day until you move!!

Moving On! Finalise That Deal . . . . 

OK. You think that you’ve agreed basic terms on the property, and its time to firm up the deal. Rule Number Five is “Confirm It In Writing”. Again, it might seem obvious, but relocation is stressful, and people do silly things by accident. Confirm your offer subject to contract (and use those words) to the agent by emailing or faxing it to them. Add your agreed list of works to your offer. Putting it in writing avoids misunderstandings, and a fight with your partner when it all falls apart!

The agent will need to take out references on the potential Tenant, to demonstrate to the Landlord that they are reputable, and that they can afford the rent. For a company, this can mean seeking references from bankers, accountants and solicitors, plus asking the employer to provide a reference on the employee (i.e. you) occupying the property. For you as Tenant, it means a bank reference, ideally from a UK bank, an employer’s reference, and sometimes a character reference. Many agents use external credit referencing agencies, and if so you’ll be asked to provide previous addresses and credit history. Some of the questions may seem intrusive – if you feel that they are unreasonably so then don’t be afraid to query them, but at the same time remember that they have a job to do. Prepare for the referencing procedure in advance by ensuring that you bring personal information with you!!

The agent will draft a letting agreement, and often just ask you to sign it i.e. its non-negotiable. Go back to Rule Number Three (above). Every contract is fully negotiable, and you should be certain that what you’ve agreed with the agent actually finds its way into the letting agreement!! Rule Number Six is the very obvious “Don’t Sign Anything Until You Understand It All”. If you or your company’s legal hack don’t know UK Landlord & Tenant law, then find someone who does, and get them to check the contract for you.

Be aware of a nasty practice called gazumping. Greed affects us all at one stage or another, and gazumping is an attempt by the Landlord, or an unscrupulous agent, to force the price up. Most larger agents try to avoid gazumping, but in many cases the Landlord will have the property on the market with more than one agent, and its the second agent who will encourage the Landlord to accept a second, slightly higher offer. Our best advice is (1) try and resist the temptation to join in – just ignore the pressure, and (2) try and keep the time between offer and contract signature as short as possible – get all your stuff together in advance!!

As part of the deal, you’ll be asked to provide as much as six weeks' rent as a security deposit. Don’t allow this money to be held by the Landlord. If the agent is bonded (all ARLA members are, and some NAEA agents are too) then have the agent hold the money as stakeholder. Otherwise try to agree that no cash changes hands and that instead the Tenant, or a guarantor, gives a Letter of Guarantee. If they insist on a cash deposit, have it held by a solicitor, again as stakeholder. Why the fuss? Well, it’s your money, and you want it back when the tenancy ends, don’t you? So keep it somewhere safe!!

One last thing. On the day that the tenancy starts, you won’t get the keys unless the agent has got a signed contract, all the references that they need, and all the initial monies, as cleared funds. This means making sure that your money is in the UK, and that payment has been made to the agent in advance, so that on the day that the tenancy starts, the money is in the agent’s bank account. If you can’t do this, or if you feel the need, then use a banker’s draft instead, drawn on a UK bank.

Ready to move in? Good luck!! Enjoy your stay in your new home!!

This article appeared in the September 2004 edition of Focus, the expat information and lifestyle magazine. Focus is the information resource for expatriates, international assignees and their families living in the UK. The Relocation Bureau have been valued sponsors of Focus since 1990.

Craig Vassie can be contacted by phone on +44-1494-816650, or by email to: craig.vassie@reloburo.com. The Relocation Bureau web site www.reloburo.com has a whole pile of useful UK information for expatriates. 

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