One of the most important decisions you will make as a landlord is how much rent to charge your tenants. If you set your rent too high then you will risk making your property too expensive for potential tenants causing you to suffer rental voids. Alternatively, if you set the rent too low then you may end up causing yourself to suffer financial losses.
Know your market
Rental voids can really affect the financial viability of your buy-to-let so ensuring that you minimise the causes of these is very important. One of the main causes is not appreciating how location can affect the rental price of a property. Take the time to get a feel for the local market. Research other local rental properties and compare your own property to them in order to establish how much a property in that area and in the same condition rents for.
Features
If your property has attractive features that make it stand out from the competition then these can increase the rental value. For example, post-pandemic tenants place more value on outdoor areas and space than they did before the lockdowns. It is not just physical features which can increase the attractiveness of your property to tenants. Working from home looks set to stay for many workers meaning a fast internet connection can be worth its weight in gold.
Furnished/Unfurnished
Furnished properties tend to achieve higher rents than unfurnished properties. However, this is not always the case with the quality and the condition of the furnishings and the appliances having a big effect on the rental price.
Ideal tenant
Identifying who your ideal tenant is and ensuring that your property can meet their needs and wants will help you to attract the type of tenant that you would like. You should bear in mind that the location of your property will often dictate the type of available potential tenants. For example, if it is in the centre of a city you are likely to have a higher number of potential tenants who are highly paid, young professionals than you will do if your property is located in the countryside.
Raising the rent
In order to ensure that your rental income remains profitable you will inevitably have to consider raising the rent from time to time to keep it apace with rising costs. However, especially during the current cost of living crisis raising the rent does run the risk of your tenant choosing to leave. This would potentially leave you with a rental void and the need to find a new tenant. Even if they do stay, choosing to increase the rent to higher than current market rates can affect your relationship with your tenant in a negative way. Therefore, it is essential that if you do decide to increase the rent for an existing tenant that you make sure that it is done both professionally and fairly.
Placing a rental value on your property can be difficult. Seeking the advice of a local letting agent is the best way to ensure that you are charging the optimum rate for your property taking into account all of the factors above.
Please do not hesitate to give us a call for an up-to-date review of your rental investment in Bingham, Grantham, Newark, Bottesford. Or if you would like to know more about how we can help you to manage it please do send us an email to gemma@flying-keys.co.uk or give us a call on 01400 675175 to find out how we can help you to manage it.
