Want to be a Rental Agent?
The one thing we can all agree on is that the modern estate agent is completely different from those of days gone by. The industry bar has been raised and, thanks to the strict educational standards imposed, it’s unlikely that it will never drop back down to the levels seen in the past.
Of course, there are still those who operate without a Fidelity Fund Certificate and who last saw the inside of a classroom 20 years ago. However, their days are surely numbered, given that these individuals will find it all but impossible to get work with a reputable agency. It takes a fair amount of knowledge and skill to sell a home, and those who can’t make it in the industry tend to move on fairly quickly. This is understandable, given that sales agents only receive commission when they sell a home.
However, real estate isn’t just about selling homes and there are many who view rentals as a quick and easy way to earn money. As in sales, there are specialised rental companies who go all out to ensure that their letting agents are qualified, educated and licensed to rent out property.
Unfortunately, there is also a large number of smaller agencies that employ individuals who refuse to conform to industry standards and who often have little or no idea of what is legally required by a rental agent. It’s a sad state of affairs and, according to a number of highly placed people involved in rentals, not enough is being done to put these agencies or agents out of business.
Loose cannons are not the only problem the rental industry is facing. Greg Harris, CEO of Chas Everitt Property Rentals, said that although both the NQF4 and NQF5 qualifications apply to rental agents, there is a lot of specialised knowledge, legal and otherwise, that is not covered in the curriculum. There is, for example, very little taught about the Rental Housing Act or how rental housing tribunals operate, and such training and information must be acquired on the job.
It takes more than skills to be a Rental Agent…
The ability to sell a home does not necessarily translate into the skills needed to let a property. Dina Porteous of Pam Golding Properties said: “An agent represents the landlord in terms of a mandate and it is imperative that a rental agent has a clear understanding of what the landlord’s rights and obligations are in terms of the Rental Housing Act. One needs to remember that the agent will deal with more than one landlord as his rental portfolio grows and so should the level of skills in dealing with the portfolio.”
Rental agents must have financial management skills, good communication skills and knowledge of the relevant acts. All money received by the agent must be received through the agent’s trust account. This trust account must be registered with the EAAB and managed in terms of section 32 of the Estate Agency Affairs Act No. 112 of 1976 and all deposits must be invested in terms of the Rental Housing Act No. 50 of 1999.
Negotiation and mediation skills are imperative as agents act as the go-between for the landlord and the tenant. Agents must also understand the Consumer Protection Act No. 68 of 2008 and the Sectional Titles Act No. 95 of 1986.
One can understand the lure of the rental market as, unlike sales, it can produce a regular income. The correct order of business is to develop your skills as a rental agent and then concern yourself with income.
What differentiates an effective rental agent from a poor one are proper training, access to excellent credit-checking and property management systems and a huge dose of empathy for landlords and tenants, because this is business is all about people. Said Harris: “The rental sector can be a very good business option, providing a steady income if run correctly, but it is not simply a matter of deciding to become a letting agent and setting up shop. You need specialist knowledge and training as well as access to the proper technology, management and marketing systems if you wish to be successful, so it is advisable to work under the banner of an established brand that already has all these things in place.”
The other important aspect of the rental industry is educating landlords and tenants as to the importance of dealing only with qualified, registered agents and agencies, even though they may charge more than their unqualified counterparts.
Said Porteous: “There are good agents out there, but they and their comprehensive services are often overshadowed by unregistered agents who will not go to the expense of limiting financial risks to either the landlord or the tenant.”
South African consumers still have a long way to go in recognising the benefits of using a registered agency, and the existence of so many illegal operators in this country is cause for concern. The EAAB, according to Harris, only conducts random checks and independent audits of trust accounts, which in his opinion is not sufficient to protect consumer interests. He suggested that there should be a separate or additional national qualification for rental agents: “At this stage there are specialist courses available, including one presented by Vivien Marx from the Rental Housing Tribunal that covers the Rental Housing Act and what role the housing tribunals have to play in the industry. These types of courses are far more relevant for those who work in the day-to-day operations of the rental industry.”
Rentals might not have the same prestige as real estate sales, but they do form a significant part of the real estate sector and are often agents’ bread and butter when sales takes a downturn.
Words: Lea Jacobs