This week we’re talking about how to maximise your rent – both in terms of re-letting a property, and raising the rent on an existing tenant. It’s a topic worth delving into because if you’re being squeezed by growing expenses or higher mortgage payments, it’s the one way you can make more money from your existing portfolio.
So, how do you maximise your rent when re-letting a property?
- Make sure you’re charging an appropriate rent for the area (by using Rightmove and asking your agent) – the norm might have changed since you last rented it
- Take professional photos: great photos mean more people through the door, which mean more chance of getting the right tenant at the right price
- Factor in the time of year: December is weak and January is strong, and for towns with a high student population that’s a factor too
- Spend money on easy wins that matter, like repainting a key room or replacing tatty lino
- Consider letting furnished to secure a higher rent and reduce your taxable income by 10% (see our free tax course for more)
- Conduct block viewings to stoke competition, if you’re doing the viewings yourself
- If tenants are in occupation when viewings are being carried out, make sure they’re on-side so they keep it tidy and are amenable about access
Then when there are other factors to consider when you want to raise the rent on an existing tenant:
- You can only increase the rent once every 12 month period (unless your AST says otherwise), and only after any fixed term has elapsed
- You need to do it by either negotiating a new AST or issuing a 13(2) notice, but most important is to have a dialogue with the tenant to explain your intentions rather than just going legal
- Only increase the rent if market rents in your area are now high by comparison
- Only raise the rent to a level where it’s still highly competitive for the area – so if the tenant gets annoyed and looks around, they won’t be able to find anything better
- Or, just leave it as it is and be grateful you’ve got a good tenant!
For details on all of these, and a few extra tips we’ve snuck in there, take a listen to the episode!
Resource of the week
Your own private island for £365,000, anyone? Sure it’s just off Cambodia rather than the Bahamas, but you can barely get a parking space in Chelsea for that kind of money.
Yes, this week’s resource is The Guardian’s fantasy foreign property finder. Just enter your budget, and it will search Rightmove to show you a selection of properties around the world that fall within your budget.
Useful? Not really, but it’s always interesting to see what very different properties the same amount of money can buy you in different parts of the world. Just make sure you listen to Episode 34 – The beginners’ guide to overseas property investment before you get too tempted…
News this week
Scotland didn’t get their independence, but they’re certainly putting their own stamp on the property market north of the border.
Or rather, taking their stamp off it – as Stamp Duty is being replaced with a more progressive charge called Land and Buildings Transaction Tax. The full details are explained here.
They also plan to restrict the Help To Buy scheme so it only applies to properties costing up to £250,000, which makes a lot of sense to us. (And it’s one of the ideas we discussed in Episode 60 – Can the property super-bubble be stopped?.
We can’t say whether they’re getting the details right or not, but it’s nice to see a country attempting to overhaul some of the more bonkers parts of the property transaction process.
This week’s mentions
We’re putting together another “listener questions” episode, and we’d love to have yours!
You can leave us a voicemail very easily: just visit thepropertyhub.net/podcast and click the “leave us a message” icon on the right-hand side.
So get the kudos of having your voice on the show and your question answered at the same time – double-win!
Join the conversation
What tips do you have for maximising the rent you can get from a property?
Do you tend to increase the rent for existing tenants, take an “if it ain’t broke” approach?
We’d love to know, so join the discussion in The Property Hub!
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