Make
Sure the Price is Right on Your Residential Letting
By Philip
Suter
With
so many people entering the Buy to let market in the UK, Ireland, France,
Spain and other countries it is very important get the rental price competitive.
This applies just as much if it is a long-term letting or a self-catering holiday
rental.
If
you have just purchased a residential letting property and have a mortgage you
naturally have to cover the payments, but regardless of a mortgage to service,
if your property is over priced renters will not pay a higher price. The only
time when this can happen is when there is a small supply of property and big
demand for that that type of letting.
In
the UK a tenant will still have to pay gas, electricity, water, Council tax, telephone
and insurance on top of the monthly rent. In other words a rental of £650 per
month means £900 per month of total outgoings. Many Landlords do not realise this
and think that all the renters have to pay is the rent to them.
A
landlord who insists that their property is “worth” £X per monthand in
reality they have been advised by the professional agent it is only worth £-X
can have problems. If it stays on the rental market for a while at a price
that is too high they will never make up the lost rental (unless there is galloping
inflation). It can of course be a totally different scenario with a property that
is being sold; particularly if property prices are rising in the area or country.
With
a self-catering holiday rental you have to offer the property on what the ”market
will pay”. Your property just might be located in area whereby there are seasonal
or (one time) events when beds are at a premium and to be able achieve a much
higher price. (Wimbledon- England for the tennis, Monaco for the Formula one
Grand Prix, Cannes, France for the film festival, Cheltenham-England for the horse
racing in March etc.) At other times unless your property’s price is competitive
it will remain empty more often than full.
If
you are using an agent, take advice from the agent. They are normally local to
market conditions for long-term rentals and for holiday rentals a specialist agent
will have studied your area and keep rental values up to date. If you are using
the Internet as a guide spend some time researching. Use a search engine to find
a rental agent in the area your property is located in or for a self-catering
holiday rental get comparables from a site like jmlvillas.com.
Finally
remember with the long term rentals market that although some people are prepared
to make an offer, don’t pitch the price high so that you think you will get a
Tenant wanting to make an offer. They don’t necessarily do that. Many people wanting
to rent think that prices advertised are fixed and the owner won’t negotiate or
they don’t even think to go down that route. They will look at the next available
property in “their price bracket”. This is rather like shopping in the
High Street. They will only pay the price the “goods” are being offered at in
the window.
With
a holiday rental,it is very rare for a holidaymaker to make an offer; they just
purely search in their price bracket.
Philip
Suter is a Director of JML Property Services http://www.jmlproperty.co.uk
a UK based company offering Insurance products on line at http://www.jml-property-insurance.co.uk
and a holiday home advertising service http://www.jmlvillas.com
and management training within the uk. He is a very experienced property consultant
with over 30 years work in the Residential letting business in the UK and served
on the National Council of ARLA. He is a Fellow of the National Association of
Estate Agents (NAEA) and a Member of The association of Residential Letting Agents
(ARLA)
Article
Source:http://EzineArticles.com/?expert=Philip_Suter
The
information supplied on this page is by a third party and jml Property Services
do not take any responsibility to its accuracy ©jmlpropertyservices02/06
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