Welcome back to the first Walsall Property Market blog article of the New Year! I hope you enjoyed a well deserved break over the holidays?
Over the weekend I received a call from a newbie landlord living in the south who was purchasing his first buy to let Walsall property. He said he had been following my blog for a while and wanted to ask a few questions. His first question was “How much rent can I achieve for my property?” A question I get asked once or twice a year...!!
I thought it was only fair to explain the thoughts behind an appraisal and how I arrive at the appraisal level when I go out to a property. Below are the key points of that conversation and my thoughts…
Getting the most from your property
When you are renting out property, you want to be able to maximise your profits, whilst also being fair with prospective tenants. If you charge rents which are too high, you are likely to put people off, which can make it difficult to get your property let.
These are some basic points landlords should consider when trying to find the right rental price to charge tenants.
Location vs Competition vs Demand
The location of the property is one of the main considerations when it comes to pricing up your rental property. If the property is in Parkhall, Tamebridge, Aldridge, Delves, Streetly as compared to Alumwell, Bentley, Blakenall, Beechdale then the premiums will naturally differ.
I was conducting a best price guide for one of our Walsall landlords in the Chuckery area recently and within a 1/4 mile radius of their postcode, there were over 11 similar properties available to rent! Two of the properties are still being marketed since first being listed in September 2016!!
Unfortunately, the demand for properties in this location did not outweigh supply… quite the opposite. So in these situations, I would recommend marketing the property just under market value to give you a competitive edge. Yes, you can hold out for that few extra moola a month but here’s the kicker…holding out for £25 more on the rent could lose you a whopping £495 per month! And…how many £25 go into £495…??
For out-of-town properties, you may have less competition however, if you over-price, you will still struggle to let it out. The key is to find a balance between what is currently available against what has been let in the last 6 months and what is your appetite to get a quick let to reduce any void period.
Know your target audience
You should also think about the type of tenants you are looking for in your property. Are you happy for students to let your property or would you prefer professionals?
We recently took on a 4 bedroom property in a student area however, the landlord did not want students. Needless to say the property remained on the market for a while until the landlord agreed to open up the net and allow students… the property was quickly let thereafter.
Size of property
The size of the property is another consideration and also any additional extras, such as a garden/ driveway/ en-suite/ additional WC or garage. Again, looking at properties of a similar size will help give you a better idea of the best rates to charge.
Amenities / transport links
You should also consider the local amenities. If you are situated near shops, surgeries and town centre you can definitely charge more for rent. The opposite is also true…some people like to be away from the ‘hustle and bustle’ of people and cars therefore, the outer semi-rural areas would be more appealing to them. Proximity to train stations/ bus routes plays a vital role in pricing up your property. In Walsall we are fortunate to have the added bonus of being in the middle of the motorway network.
Furnished properties are generally more expensive than unfurnished although not in all cases. You may want to think about furnishing the property although the cost of maintaining the furnishings may be prohibitive and in the end counter-productive against your net annual yields.
If you would like a professional opinion from someone who conducts countless appraisals on a regular basis feel free to get in touch with me. There is no obligation on your part and I don’t charge to give my opinion.
Don’t forget to visit the links below to view back dated deals and Walsall Property News.