Top tips on how to keep your tenants
Date online: 17/05/2016
Birmingham has the lowest tenant turnover, with renters staying an average of two years and four months in the same property. Cardiff on the other hand, has the highest turnover, with the average property being vacated less than a year after being filled. Leeds (12 months) and Bristol (14 months) also have a high turnover of tenants, which could prove problematic for local landlords.
The analysis also looked at the average time it takes to fill a vacated property revealing that on average, it takes a landlord 22 days to find a new tenant. This could result in an average loss of £547 in uncollected rent. When calculating the yield for a property, landlords need to take into account this void period and ensure they have sufficient resources to meet any mortgage, ground rent or other charges.
Vacant properties in Birmingham are filled the quickest, with a landlord finding a tenant in just 11 days. However, in Liverpool and Aberdeen landlords struggle the most to fill their properties, taking an average of 33 days, to find a suitable candidate. Direct Line for Business's analysis estimates that this gap in rent could cost landlords as much as £761 in Liverpool and £913 in Aberdeen.
Even with such a competitive rental market in London, letting agents in the capital claim that it takes just under three weeks (20 days) on average to fill a property. With average monthly rents in central London surpassing £2,000 this could amount to a loss of £1,869 in income.
The research also found that landlords can't always rely on occupants remaining in a property for the duration of their tenancy agreement, with one in 11 (9%) moving out early. The highest rate of tenancy turnover is north of the border in Aberdeen where a fifth (19%) of tenants leave a property before the end of the tenancy agreement with Leeds and Sheffield both close behind at 13%.
Nick Breton, head of Direct Line for Business, said: “This research highlights the pressure landlords are under to replace outgoing tenants in their properties. Vacant properties are obviously a worry for landlords but it's vitally important that they take into account void periods when calculating the affordability of owning a rental property.
Staying on top of the on-going changes within the industry can be time-consuming and a battle for landlords and we fully appreciate the challenges they face when it comes to managing their rental properties. To help alleviate some of the stress, we have developed the Mobile Landlord app which can manage up to five properties. The app can track income, calculate yields, set handy reminders such as when a tenancy agreement may be coming to an end and also keep landlords up-to-date with any new changes in the market through its Knowledge Centre.”
Top tips for landlords wanting to keep their tenants for the duration of their agreement:
Be fair: The rental market is always shifting, so it's worth keeping an eye on how competitive your rent is compared to the local market. The cost of rent is one of the biggest factors when it comes to influencing renters so making sure your tenants feel like they are paying a fair price will go a long way to ensuring they don't look elsewhere
Be flexible: Assuming that you trust your current tenants in the property, it is always worth being flexible on certain elements of the rental contract. It is important for occupants to make their house feel like a home, so if this involves decorating or minor DIY – or even getting a pet – it is worth being open to requests and discussing them with tenants to make sure everyone stays happy
Be approachable: As a landlord, it is your responsibility to keep the property in decent condition for your occupants, and it is important for tenants to feel that they can reach you when they need to. By maintaining contact and being approachable, this could easily prevent small problems becoming big problems
Be helpful: As well as responding to requests, it can be hugely beneficial in the long run to make the first move – especially when a tenant moves in. Furthermore, if you know that for example a washing machine is getting old, it will only improve your relationship with your tenants if you replace it before it breaks down. This can also make your life a lot easier!