Buy-to-let landlords are being warned they need to be cautious and do their homework before instructing a letting agent in the face of growing legislation and falling profits.

The warning comes from Landlord Licensing & Defence which says that landlords should research the letting agent they are considering signing up with because not all agents are the same.

The firm’s compliance expert, Phil Turtle, said: “We have lots of experience in dealing with agents who simply do not know the law when it comes to licensing a landlord’s property and other important aspects, including fire regulations.

“In particular, they don’t always know the HMO regulations that apply to letting three- and four-person shared homes.”

He added that council regulations and licensing is becoming a growing worry for part-time and ‘accidental’ landlords.

Turtle continued: “There’s a danger of a landlord switching to an incompetent agent who will not be much help because agents don’t always understand the law and regulations. Some agents, as a result, get landlords into trouble and face fines.

“That might be hard to believe, but there’s no doubt that half of the landlord clients we deal with have been dropped into trouble with local authorities by their letting agent.”

Turtle says that landlords should check the potential agent is suitably qualified by contacting other landlord clients or by reading testimonials as to how good the agent is before signing a contract.

He added: “The bottom line to appreciate is that while a letting agent will be taking a slice of the monthly rent, if there are any problems such as not being properly licensed with the local authority, then it will be for the landlord to resolve – and to pay the fines and, potentially, face a Rent Repayment Order.

“Both the landlord and agent face being fined £30,000 if there is a licensing issue.”