How do you know what the maximum rent can be for your property?
The good news is that the answer is simple: the maximum rent is the highest price that someone is willing to pay at a given time, the bad news is that rent values change constantly and some agents will bamboozle you with deliberately inflated rents.
The problem is that the estate and letting agent industry is built upon agents who:
1. Over-value properties to excite your greed and win the business. This means that you become ‘anchored’ to the high value.
2. Butter you up while the over-priced property languishes on the market.
3. Then tell you to drop the price to the level they knew it should be all along.
You also have some sellers / landlords who are convinced their property is worth more than it is and refuse to listen to their agent. Inflated prices mean that, if you are selling, your property loses credibility; if you are letting, you lose income – an empty property earns you nothing. So what can you do?
1. Research the market. Use property portals to get a feel for ‘asking rents’. But bear in mind that these are properties which have not yet let – the actual agreed rent will be lower as many are at point 2 above.
2. Compare, compare, compare. Ask your agent for evidence of similar properties they have let recently. If they do not have any, then you cannot trust their valuation – full stop. If they do, ask if these properties have the same parking / furnishing / quality as yours.
3. Be honest about the quality of your property. We all think our children are the most beautiful, but being too partial is dangerous.
4. If you trust your agent, take their advice. Look at the volume of competitive properties, how they compare, and the quality of your property and agree a first asking rent with the agent. Be confident but not naive.
5. Be flexible, be decisive. If no viewings materialise after two weeks, the rent is too high. Reducing the rent will hurt, but successful landlords take action. They know they need to find the biting point of demand vs supply.
When is the best time of year for letting a property?
The best time of year will vary, but, generally, family and rural properties let best in spring and summer. The Oxford market is seasonal and rents are higher in summer due to the demand. Outside Oxford, demand for 1- and 2-bedroom homes is fairly constant all year round.
This is one of the 50 most asked questions in our new book: Landlord Intelligence.