Having an empty property is not a good scenario for any landlord. No matter what you expect to reap through a future sale in capital appreciation, a major part of property investment is about rental yields.
How long do people rent for?
While the UK average was 10 months in February, again, it varied from area to area. The longest tenancies tend to be in London, where renters stay put for an average of 14 months. At the other end of the scale, those renting in the north-west only stay for eight months.
At the moment, demand is extremely high for rental accommodation. While the number of rental properties available might be dipping, according to statistics, the number of tenants searching is on the up. This is generally a good thing for buy-to-let landlords, and could explain the shrinking void periods.
Make tenants want to stay
As a landlord or property investor, it is in your best interests to keep your tenants in your property for as long as possible, in most cases. While so-called “rogue landlords” attempt to cut corners to try to maximise profits, it goes without saying that this is a very poor business model.
Clearly there is only so much influence you can have on your tenants’ behaviour. But there are steps you can take to reduce your risk of void periods.
Tips to Avoid Void Periods
- Void proof your property. Make sure your property is the best it can be. Kitchens and bathrooms sell a property so it’s worth investing in them. Tenants’ expectations of rental properties are increasing all the time. Your property needs to be of a high standard to attract and retain tenants
- Get good tenants and keep them. Invest in tenant referencing to give you reassurance about your potential tenants. If they are moving on, ask them why? You might be able to resolve their issue or have another property that suits their changing needs
- Every area has its ceiling rent. Make sure you set a realistic rent for the area your property is in. It’s more cost effective to get the property rented quickly at a slightly lower rent than holding out for a higher rent and risking a void period
- Offer a deal. A discount for the first month’s rent or including amenities can help clinch the deal for a potential tenant or help retain an existing one
- Offer good customer service to your tenants. Be open and accommodating to reasonable tenants requests. Your reputation as a landlord depends on it. You can always include a clause in the tenancy contract to ensure property is returned to its original condition when your tenants leave
- Consider letting on a multiple occupancy basis. Renting by room means if one tenant leaves you still have rent coming in while you find a replacement
- Invest in your property. Use any void periods to invest in your property or to do essential maintenance work
- Budget for void period. The rule of thumb is one month per year. If you have accounted, and planned financially for it, it won’t be an unexpected expense.