If your property has been listed for several weeks and you have yet to receive any offers, it’s time to consider reassessing your strategy. As we’re sure you’re aware, the longer your property stays on the market, the greater your risk of facing a lengthy void period with mounting costs and no rental income to cover expenses.
Whatever the reason might be for your property’s extended run on the listings portals, our tips can help you identify the problem and take proactive steps to find great renters quicker. We’re sure you have a fantastic home to offer to the right tenants - let’s explore why you might be struggling to find someone and what you can do about it.
This is often the main culprit if a property is struggling to gain any traction with renters. If you are receiving very few requests for viewings, it is most likely because renters viewing your property listing are deterred by the asking price. You can take further steps to identify if this is the issue by finding out how many views the listing is getting. If very few renters are clicking through onto the full property advert, then your property is probably not being listed at the correct price point. Your letting agent should have access to this data, so don’t hesitate to ask them for it.
There are several reasons why your property might be priced incorrectly:
- The supply of similar properties available on the market is high.
This might have changed significantly since the last time your property was advertised for let, which would explain why you’re struggling to find renters at a price point that has served you well in the past. For example, the overall supply of properties available in London’s prime central locations has increased by as much as 40% since the start of the Covid-19 pandemic. This is due to Airbnb hosts migrating their holiday rentals onto the residential market as the international tourism industry has collapsed. If supply exceeds demand, this will reduce the market value of your property.
Alternatively, it might be the case that a new development in the area introduces a significant volume of new housing stock into the local neighbourhood. Depending on the price point of new units, this may adversely impact the value of existing rental properties in the local area.
- There is insufficient demand for the neighbourhood or type of your property.
Local markets are granular, and just because a neighbourhood is in-demand generally doesn’t necessarily mean that there’s a large applicant pool for your property. For example, demand might be high for local multi-bedroom properties but comparatively low for one-bedroom flats.
Demand will also vary according to season, and you cannot price a property during low season as you might have done during periods of peak demand. For example, if a tenant rents from you in the summer (generally a busy time for the lettings market), but activates a break clause and leaves in the dead of winter, it is highly unlikely that you will be able to return the property to the market and let it at the same price. Peak season will vary between location and type of property, so it is important to do thorough market research before and during the process of marketing your home for let.
- Your property was not valued correctly.
The property industry is notorious for the lack of trust it inspires in consumers. This is partly because the use of unsavoury sales practices among agents trying to win business remains commonplace. Unfortunately, it is not unusual for a negotiator to value a property at significantly higher than the going market rate to secure an instruction. If a valuation sounds too good to be true, it probably is. Ask for a thorough justification for any pricing suggested by your lettings provider and be sure to do your own extensive research across the various online listings portals before agreeing to any suggested pricing.
The longer your property remains on the market, the greater your risk of entering into a costly void period. While your primary objective will always be to secure the best yield possible on your asset, it is far better to let your property at slightly below your target asking price sooner than to let it at the desired rent later. The standing costs incurred if the property is vacant (that you will have to cover out of pocket without any rental income) will eat into your annual income far more than accepting a lower offer and letting the property quickly.
At Home Made, our online portal allows landlords to see the number of views their property is receiving on the listings portals and the number of viewings that are booked or have taken place. It also generates pricing recommendations based on live market data and smart software analytics. This transparent access to data allows you to see the rationale for any pricing strategy suggested by our sales team and make the best decisions when it comes to marketing your property.
Before you make any decision about pricing, you should visit the online portals and check how each site divides its pricing bracket into increments for renters when they set their search budget. For example, on Rightmove the amount by which you can expand your search budget is not always in even increments. There is no sliding scale or free text option, and when a renter sets the upper limit of their search budget they are required to select from a series of existing pricing options. Between £1,000pcm to £2,000pcm, the available prices increase as follows:
As you can see, the price does not always move up in even units of 100. If your property is priced ever so slightly above one of these less intuitive pricing points, you might be missing out on a lot of potential listing views and enquiries from renters with a budget that is only marginally below your asking price. For instance, if you have advertised your property at £1,275 pcm you will price yourself out of contention with renters who set an upper limit of £1,250 pcm.
You can generate far more demand for your property and let it more quickly if you take the time to research how the listings portals allow renters to set their budget and make sure that you advertise within the best bracket for maximising views on your property.
Poor quality marketing materials
After pricing, the quality of the marketing materials used to advertise your property is the second factor most likely to be deterring prospective renters from making an enquiry. If the images used to market your property don’t present the best possible image of the available space then people won’t pick up the phone to request a viewing.
Common issues we see in property marketing materials include:
- Poor lighting.
- Low image resolution.
- Unflattering angles.
- Far too many photos included on the listing.
- Images clearly taken on a mobile phone (with the agents responsible for taking the photograph often visible in bathroom mirrors in the most egregious examples).
- Unclean or untidy rooms.
Wherever possible, you should arrange for professional photographs of your property for use in your marketing materials. If your property is currently tenanted, reach out to your current renters and ask if they can help to make the place presentable and keep it tidy while you try to find new tenants. A little goodwill goes a long way, so it’s a good idea to thank your renters for their efforts accordingly (you can seldom go wrong with chocolate). Transforming your property into an effective show home and staging it correctly for photos takes considerable time and labour, and you will be able to get much better material to work with if your current renters are able to help out.
The property portals require you to select only a couple of photos as your cover images. Review the listing of your property to make sure that this valuable real estate is occupied by the most eye-catching images of your property. If there’s a stunning garden shot or particularly impactful image of the reception languishing near the end of the photo gallery, call your lettings service and ask them to change the order of the images.
Once you have high quality marketing photos, the accompanying property description also needs to hit the mark. The property’s best features should be highlighted in the opening lines and the spelling and grammar needs to be on point so that the listing appears professional. Most importantly, the description needs to be accurate. If you notice anything amiss, let your agent know as soon as possible.
Wear and tear
If the property is generating interest but multiple viewings have yet to yield any offers, then it is likely that the property itself needs a little bit of sprucing up. When it comes to marketing materials the right angle and lighting can be very forgiving, but prospective renters will definitely notice significant wear and tear or dilapidation when they visit the property.
If the property is still tenanted, it might not be practical to touch up the walls with fresh paint or arrange for carpets to be steam cleaned. However, if the property is vacant following a long (or particularly raucous) tenancy then it is worth taking a couple of days to fix any signs of substantial wear and tear and freshen the place up to make it more appealing. If possible, it is also worth visiting in person to take note of any major issues (such as damp or mold) that will require immediate attention.
Consider all the senses when contemplating any works that might be necessary to make your property more lettable. Are there any unusual smells, excessive noises, noticeable draughts etc that you can address without expensive and time-consuming restoration works? For example, something as simple as fitting heavier curtains can work to exclude cold draughts and make the property warmer and more appealing.
Making minor upgrades to the condition of the property will help you let it more quickly. Furthermore, it also helps you to avoid a situation where you end up negotiating with a renter who is willing to take the property subject to the completion of works due the lack of other offers. Where this happens there is often a discrepancy between the expectations of the renter and landlord about the scope of works to be completed, which can lead to tension at the beginning of the tenancy. It’s better to take charge of any minor improvement work yourself and increase the chance of finding a renter who is willing to take your property as it is.
Casting a small net
You might be making it harder to find agreeable offers by being too selective about the type of renter you’re willing to allow into your property. If your property has been on the market for several weeks, it might indicate that the issue is a lack of significant demand among renters for your type of property. If this is the case, then it will be hard to find your specific ideal renter without incurring a significant void period.
There are several possible reasons for this. Overall demand in the market might be down due to significant economic disruption (as we have seen at various points throughout the year due to the pandemic), or it could be that the local neighbourhood is waning in popularity with your preferred demographic. For example, if an area has become popular with students over recent years, then it’s most likely going to get harder to find a family to rent the property. Whatever the reason, if demand for your property is lower than usual then it might be necessary to cast a wider net to let your property.
We have written extensively on the benefits of letting your property to tenants with pets and student renters. Branching out in either direction can lead to both higher yields and shorter void periods due to competition for properties that serve the specific needs of these renters (particularly renters with pets). By keeping an open mind and assessing applicants you wouldn’t normally consider on a case-by-case basis, you can get far more eyes on your property and secure great tenants.
It’s important to remember that opening up your property to a more diverse range of prospective tenants doesn’t mean compromising on the quality of renter you agree to terms with. Tenants will need to be referenced as thoroughly as always, and if there are any red flags then you should not proceed - even if it means the property will remain vacant. The potential costs associated with renting to bad tenants far outweigh the short-term benefits of looking the other way on questions of income or character.
At Home Made, we’re experts when it comes to finding the right renter - fast! We are always refining our citywide model and looking for new and creative ways to use data insights to speed up processes and market your asset to the widest possible audience. If you would like help letting your property, we would love to hear from you and discuss your property needs.