It still amazes me when I find that landlords are not prepared to drop the rent on a property in order to try and let it quickly. Sometimes we are just too concerned in making sure that the ‘numbers stack up’ that we fail to see how much we could lose in the short-term and that we could be playing ‘catch-up’ for a while.
Let me give you an example:
The market rent for a property is £600 and this is what similar properties are also advertised for. Now, each month that a property does not let costs you a minimum of £600 i.e. the rent plus all the bills that you have to pay while the property is empty.
Let’s face it, with the current credit crunch everybody is looking to try and save money, including your tenants. Therefore, by dropping your rent to £550 you have a better chance of letting it quickly, especially if your competitors continue to advertise at £600.
If you know you can easily and quickly let your property for £550 then why compete against the other properties that are out there for £600?
It is easier to come up with £50 per month in lost rent than it is to come up with £600 (plus bills) in lost rent per month for every month the property remains empty.
By trying to get market rent you could run the risk of getting no rent, and this, of course, will mean a minimum of £600 rental loss for each month you try to hold out for that extra £50 of rental income!
Remember: Every property will let at a price. As landlords, our primary focus is to let a property as quickly as possible for a good, but not necessarily the highest, rental income.
