Change is one of those things about property that you can’t avoid. This is never more evident in your portfolio than in the rent you’ll receive.
Over the past 18 months we have had probably only a half dozen properties take more than 6 weeks to get let.
The reasons for this are simple:
- Correct property selection.
- Failure to work with competent agents who give us a true indication of the realistic market rental to be received.
In this post I want to talk about the second point.
Competent agents and realistic rents
It’s deceptively hard to find a competent agent. They all talk the talk, but few actually produce good results. It’s for this reason that we always spread our risk and have a number of possible agents “on the job”. I like to put them to the test and watch which ones come up trumps.
So, let’s continue on, assuming you have found a competent rental agent. The next thing you have to consider your investment property’s realistic market rent.
One of the biggest mistakes that you will make is in sticking to the rent that you want instead of what the market will bear. I hear stories all the time involving people holding out for top money because of what they want.
Diligent readers will know that I prefer to keep things simple, and this is no different: if your agent is competent and you have not had any viewings or offers then it is likely that either your price is well over the mark or the agent’s marketing is ineffective.
If you are getting the viewings but no offers, then your price is probably over the mark. If you are getting silly offers well below what you know the market is paying then it is more than likely the agent is not representing your interests properly.
The first rule of negotiation is never accept a first offer. Send a counter offer back and always be prepared to walk away. I never take first offer unless it was what I had asked for originally, and when this happens I’m unhappy because it means I should have advertised for more.
My general principle is to work out the going market rent and then undercut it by £25. This usually means I end up with very small periods of void property and my property is always one of the first to be let. I like this as it fits in perfectly with my Set & Forget investment strategy.
Live with passion,