He acknowledges the sector has its share of challenges, including the current tax burden, and is frustrated with some of the practices he currently sees. But Mr McKechnie believes there remains strong potential for lettings businesses such as his own to grow.
What is your business called?
Dwello Property
Where is it based?
Byres Road in Glasgow’s west end
What market does it operate in?
We are a residential lettings and property management business. Over time we may look to expand into other related service lines.
What is its turnover?
Our first-year turnover will be around £0.5 million and we should push through the £1m mark after our first year. First year expectations are for a portfolio of 750 properties and hoping to push into over 1,000 by year two.
How many employees?
We have assembled a senior management team comprising the top letting agency professionals with whom I have worked over the years.
We will operate with up to 15 employees in our first year, and continue to grow in line with the expansion of the business.
Why did you take the plunge?
As a large private landlord for three decades, I have developed a very clear understanding of what a first-class letting and property management service looks like. I am determined to consistently deliver this quality of service to other landlords.
Having worked with many letting agents over the years, some of the things that have frustrated me are the poor and inaccurate advertisement of properties, the lack of value for money in repairs and maintenance costs, unnecessarily long void periods, and low responsiveness from queries both from myself as landlord and from tenants. I think too many letting agents look after the tenants to the detriment of their paying clients – the landlords.
My team at Dwello will be focused on addressing these issues and providing a service that works for tenants and landlords alike.
In addition, we will add value in terms of asset management of properties, advising landlords on refurbishment, expansion and disposal of their properties. We will basically manage properties with the same degree of love and attention with which we have managed my own, which is a fresh and unique perspective in the sector.
What were you doing before?
I have been investing in properties for let going back to the late 1990s. Before that, I was an electrician to trade.
What do you least enjoy?
I get frustrated when things that seem bread and butter to me are not done correctly, such as a letting agency missing a key feature such as private parking in an advertisement or using a screengrab from Google Maps or their phone as a photograph, both of which I have experienced with other agents recently.
How would you describe current trading conditions?
Demand for rental properties continues to exceed supply which is a positive for landlords and minimises vacant periods. However, it continues to be a challenging time for landlords with tighter regulations, higher costs, tax changes, government legislation and more rights for tenants, which have combined to lower returns.
I see this as an opportune time for landlords to expand, with high yields, a strong rental market, and now lower mortgage rates due to interest rate cuts.
What are the main challenges and opportunities in your industry?
The main challenge is that it is currently perceived to be less attractive to be a landlord for the reasons outlined, and therefore the number of rental properties available for rent is shrinking. This also creates an opportunity. The demand for rental properties is outstripping supply, and landlords who persist will benefit from the strong rental market and falling interest rates.
I also have faith in the medium to long term growth in the value of properties. Savills in their latest forecast has predicted growth of over 25% in the next five years in Scotland. It is still a resilient and attractive sector to be in.
What could the UK and Scottish Governments do to support your industry?
The UK Government and Scottish governments have increased the tax burden for landlords in our industry, and at a time of housing shortages it is certainly not helping. There is less incentive for expansion in the sector. There is also a lack of transparency on rent caps and tenants’ rights. I think the Government can start by recognising the important role that landlords play and help dispel and not feed the sentiment that landlords are all profiteering. It would also help if they can fairly resolve the confusion around rent caps and tenants’ rights.
What are your ambitions for the firm?
We are operating in a competitive marketplace, but, having been a large portfolio landlord, I believe I’m well qualified to say that there is no other letting agent with Dwello’s perspective and insight. We are determined to deliver a consistently high level of service and to deliver on our value-add asset management initiatives. We will see where that takes us, but by focusing on the now, the future should be bright for us.
We also wish to be at the forefront of technological advances in our sector, including the use of AI, but without detracting from the personal nature of the service.
What is the most valuable lesson you have learned?
Surround yourself with good people – hiring the right people is so important.
Where do you find yourself most at ease?
At home with my family.
If you weren’t in your current role, what job would you most fancy?
Certainly not one in construction, which was where I served my apprenticeship.
What phrase or quotation has inspired you the most?
“In the middle of difficulty lies opportunity.” This quote is often attributed to Albert Einstein, which seems like a grandiose quote to pick, but I think it speaks to change, new opportunities, thinking creatively, and resilience.
What is the best book you have ever read? Why is it the best?
Jula Donaldson’s The Gruffalo … I read it to my children every night before they went to bed, so it has lovely memories for me.
What has been your most challenging moment in life or business?
In the aftermath of the 2008 financial crisis, I was involved in some difficult negotiations with the bank as market values were perceived to plummet. Thankfully, I managed to come through this period with my ownership interests largely intact, however, it was a particularly challenging period for me and many other business owners (especially the ones with RBOS).
What do you now know that you wish you had known when starting out in your career?
How tricky it is to predict the future. You need a lot of resilience and patience to build your career, no matter the field. For my own industry, over the last few years, the rise in interest rates, the rise in construction costs, changes in legislation and government guidelines have had a significant impact.