More landlords now letting their property before existing tenant has moved out, but only fully managed investments completely remove threat of void periods.
- 33% of new lets in 2015 have been agreed with current tenants still living in the property
- If new lets aren’t agreed within a week of advertising, 98% of landlords are more likely to accept lower monthly rent then initially desired
- Fully managed property investment ensures that investors don’t experience void periods
Strong demand for rental property, coupled with low supply, is currently making the UK one of the best places for property investment.
For investors in cities such as Manchester, recently named the UK’s buy-to-let hotspot, there’s a growing trend of property being let before existing tenants have even moved out, according to new research from Countrywide. On average it now takes just 32 days for a property to be let in the UK.
In the first six months of 2015, 33% of all new lets were agreed with existing tenants still in the property, an increase of 27% over 12 months. For investors, this means that average rental rates can be boosted by as much as £35 per calendar month.
Comparatively, prospective new tenants can knock £21 off the asking price if the property is empty. Indeed, if the investor cannot find a new tenant in the first week of the property being advertised, around 98% are more likely to accept an offer that falls below the monthly rate they had initially desired.
David Fell, Research Analyst at Countrywide, said: “In larger rental markets, more new lets are being agreed well in advance of the current tenant leaving. As a result we’ve seen void periods fall, with a growing number of landlords having a new tenant lined up over a month before their existing tenant leaves.”
Void periods are one of the biggest concerns for UK buy-to-let investors, particularly certain demographics such as retirees who need to rely heavily on their monthly property returns to support them during their retirement.
Although this research shows that current tenant demand is strong and that void periods are down, only a fully managed property investment can truly eliminate the threat of non-tenanted properties, giving investors consistent returns and peace of mind.