An example of this is a two-bedroom apartment I let recently at £795pcm. A neighbouring property then came on for £850pcm shortly afterwards, which is what I said was probably the 'right' figure for the property in normal conditions. Only there were a lot of two-bedroom apartments on the market to rent at the time and the fact the property was empty meant it would be better to earn a lower rent but get someone in quickly then have it sat empty for longer than necessary earning nothing. A tenant moved in just three weeks after first marketing the apartment, duly paying £795pcm. Meanwhile the neighbouring property on with a different agent remained unlet for over a month, before being reduced to £795pcm anyway.
And then there's the three-bedroom house which was empty and earning the landlord nothing. I suggested a rent of £1,150pcm having let identical houses at that figure in the same street and based on similar properties on the market at the time at the same price. Instead, the landlord went with the letting agent who suggested £1,250pcm....and it remains unlet two months on! It’s now been reduced to £1,200pcm and an additional agent has been brought in to try and find a tenant; meanwhile a couple of other three-bedroom houses in the area have been reduced to £1,100pcm, so the property still remains (at least) one step behind the competition.
I'd also argue that even when (if) a property does let at an inflated figure that the tenants won't stay as long as ones who are paying a rent in line with the rest of the market. Overpricing will ultimately lead to a greater churn of tenants and additional costs to the landlord, wear and tear on the property and more void periods.
It’s therefore important for landlords to be realistic when deciding upon a rental figure. By analysing what else is on the market you should be able to gauge where your property fits in amongst what is ultimately the competition. I believe I get this balance right more than many letting agents, based on telling a landlord what they need to hear rather than what they want to hear, even if this means I lose out on some instructions (like the three-bed house above, which is still languishing on the market).
If you’d like an honest and realistic appraisal of your rental property and its achievable rent, please get in touch and I’ll be happy to help.
For more tips about buying, selling, letting and renting in Chichester, please visit www.chipropertynews.co.uk
(This article was featured in the Chichester Observer's property section on August 16, 2018)
Clive Janes, CRJ Lettings
If you are looking for an agent that is well established, professional and communicative in Chichester, then contact us to find out how we can get the best out of your investment property.
E-mail me on clive@crjlettings.co.uk or call 01243 624 599.
Don't forget to visit the links below to view my previous buy-to-let deals and Chichester Property News articles:
c/o CRJ Lettings, 30B Southgate, Chichester, West Sussex, PO19 1DP
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