Letting agents told to prepare for complete market lockdown

27 January 2021 | Renting

Letting agents told to prepare for complete market lockdown

Letting agents are being advised by an industry supplier to carry out essential checks now to prepare for a possible housing market lockdown.

The Letting Partnership claims that uncertainty is mounting in the industry about further government restrictions as the Coronavirus pandemic continues apace. 

Chris Mason, operations manager at The Letting Partnership, says: “Letting agents have time to prepare now for any lockdown of the housing market so it’s important to have plans in place if the government decides to change its strategy. We’ve all seen how quickly the situation around the pandemic can change over the last challenging year to it’s critical for agents to have a strategy in place.

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“Bank cards and bank secure keys which will need to be given to employees to take home so they can do their job remotely and an inventory of these should be kept. 

“Letting agents should also carry out spot checks on bank account details for any unusual activity. They must run a thorough spot check on client accounting records using software, bank accounts and deposit provider records. These checks should continue weekly to ensure their business stays on track when employees are working remotely.”

Mason adds that there are five key areas to check ahead of possible restrictions:

1. Inventories: If letting agents have to work from home again, they will need to take home items such as card readers, log-ins and bank secure keys. Create an inventory of these to map out which employees have them to avoid any confusion when a return to the office takes place. It will be important to ensure these are all accounted for and that any missing items are cancelled with the bank immediately.

Consider who will need access to which account to prepare for a lockdown, but remember that once the team returns to the office, they should check who has access to which account and consider whether this should be removed once employees are back in the office.

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2. Does it all add up? Landlords and contractors still need to be paid even if the housing market shuts down and letting agents have to shut up shop. So, when working remotely don’t forget to check your sums regularly. Take the current number of managed lets, then multiply this number by the average rent per month. Now add any move in monies received. The next stage is to download the client account statement in Excel or csv for the last month using online banking. Total up the payments in. The two figures should be very close.

3.Balance report: When your team moves to remote working, don’t forget to run the trial balance report, or equivalent, from the client accounting software to ensure client accounting is running like clockwork. This report should match up with the bank statement. Does the balance report show £30,000 in the bank? Then check the bank statement shows the same amount.

4.Double check: Detailed reports will be available to download from your deposit protection provider. Agents should compare the number of deposits registered with the number of AST tenancies they are currently managing. If the business collects and protects tenant deposits on behalf of ‘let only’ landlords, make sure the number of deposits protected is proportionally more than the rents collected for managed properties.

5.Be vigilant: Letting agents should always carry out spot checks for unusual activity but this is especially important when working remotely. There are software audits which detect unusual changes in bank account details across client accounts. 

These audits can pull up who changed the bank details and even whether the details then reverted back to the original. Agents should also be mindful of employees changing bank details when it’s not their responsibility to do so or keep an eye out for changes to bank details taking place at unusual times. 

Agents should be aware of cyber security too. If employees have to work from home, they should make sure their laptops or PCs have suitable malware and virus protection. Carry out a security, virus and malware check now and make sure their machines are password protected.

This post has originally been featured in Letting Agent Today.