Considerations for landlords and letting agents following the Tenant Survey 2015/16
The Tenant Survey 2015/16, carried out by YouGov on behalf of property agent Knight Frank, collected and analysed the responses of 5000 people living in privately rented property across the UK. We have highlighted what we consider to be the most significant findings and from the survey for landlords and letting agents.
First, a little context. The private rental sector has been booming, and is continuing to boom. Around 5.4 million properties are being let out to private tenants in the UK – that equates to 20% of all properties. The private rental sector is made up predominantly of private landlords – and many of them have more than one property.
Now, onto some results…
Tenant attitudes
25% of tenants either don’t want to, or aren’t sure if they want to, buy a property in the future – exactly the same amount as in last year’s survey. For those that do want to buy, it’s predicted by House Price Sentiment Index data put together by Knight Frank and Markit Economics that most people currently renting plan to buy within two to five years.
When tenants are choosing where to live, their main priority is the proximity of the property to their place of work or education. Unsurprisingly, 71% Londoners stated that being close to transport links was their biggest concern when searching for a home.
Considerations for landlords
If you rent to younger generations you may want to rethink how to charge them if you treat rent and bills separately. 64% of people aged 18 – 24 said they would rather pay their rent and other property bills (utility, internet, satellite, etc) all together in one payment.
Over two thirds of those aged 18 – 24, and 61% of 25 – 34 year olds, said their ideal tenancy agreement length would be up to one year. It’s worth considering that almost half of those aged 18 – 24 rented as part of a house-share agreement, which could possibly explain the desire for shorter tenancies. Other results also showed that one of the main reasons for changing properties was to ‘upgrade’, i.e. move somewhere nicer and/or bigger.
The majority of people prefered a partially or fully furnished property, particularly if living in London. This is likely to be down to convenience, storage and affordability. If you’re a landlord offering an unfurnished property, furnishing it may increase the demand (or allow you to be choosier with your tenants) and allow you to charge increased rent.
Considerations for letting agents
Tenants were also surveyed for their opinions on letting agents, and transparency came out top, with over 50% of people saying it was the most important quality. This was closely followed by fast responses to queries, competitive fees, and being easy to contact by phone or email. Perhaps surprisingly, only 23% considered good knowledge of rental properties to be the most important factor.
The future of the private rental market
The private rental market shows no signs of slowing down yet, although it remains to be seen what impact the new stamp duty surcharge will have on both the market and rental prices. To read more about this, click here. There are also new regulations on mortgage interest relief for buy-to-let investors coming into play in 2017 and this could result in a slight deceleration in the market. However, the anticipated escalation of large-scale investment could well continue the boom – the build-to-rent market is set to triple by 2020 with a potential £50 billion being pumped in over the next five years.
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