Although findings from a recent report show that average rents paid by tenants have now reached a record monthly high, only foolish landlords would consider this as a guaranteed license to print money.
Although it is true that today’s increasing demand for rental properties is, in part, bolstered by home buyer affordability constraints, it would be naive to believe that any increase in rents received is solely due to the supply/demand ratio. Of course there will always be a significant proportion of tenants who are forced into renting because they can’t afford to buy a home of their own. However, there is also a growing army of tenants for whom renting is a positive lifestyle choice, and it is this group that could now have a greater impact on rising rents. Tenants that chose to rent because of the flexibility and freedom in provides are those who are often prepared to pay a little more to get exactly what they want from a property. They view these dwellings as medium term homes not short term stop gap accommodation and as such are getting more specific about their requirements. Many tenants of this type want to live in lively urban areas that provide easy access to shopping, restaurants, nightlife and transport. They also want more from their interiors – modern fixtures and fittings, fashionable decor, and flexible living space – in short they want pads to be proud of. Finding a local letting agent with good market knowledge can help landlords stay on top of current rental trends within their area, helping to maximise income. Landlords who fail to impress this new generation of positive renters with well presented, targeted properties in good locations may struggle to reap the benefits of rising rents.