As is also the case when selling your property, it is important to consider when renting your property you t to tenants, what sort of people you want to be dealing with throughout the tenancy. Some Landlords are no0t very fussy, they will take any and every tenant that walks through their doors, so long as they pay the bills on time. However in some locations it is important to take note of the types of tenants your property might attract.
For example, taking into account certain cities where there is a high student population, if you are unsure or reluctant to let to students, you might want to avoid these areas, or otherwise market your house as unsuitable for students. While student tenants can often be a good form of investment, like many tenants, they do not come without their own set of trials and tribulations. The same can be said of many other types of tenants.
It is important to be able to recognise these different tenant type, ands what they could mean for your property. In this sense, then you can be fully prepared for anything thrown your way, or you can choose not to market your property to those sorts of tenants. As the property owner, you are well within your rights to limit the renting of your property to various social groups, but be aware that you are not likely to be able to limit your choice of tenants based on their marital status, their race, religion or sexual orientation. None of the above features tend to affect how they pay the rent, therefore you cannot use them as grounds to reject them as potential tenants.
Here are four of the main ‘sub-species’ of tenants, and what you can perhaps expect from them in terms of the tenancy itself.
One of the most desirable tenancies. A family of tenants with one working spouse or two working partners are proven to be in an established relationship and are thus less likely to move quickly or divorce on sudden terms. Where one or both partners has a stable source of income, these are efficient means of obtaining regular rent money and money for any reparations needed, which is both stable and reassuring for all parties. While two employed partners are more desirable (leading to two avenues of income) a single working spouse is still a highly sought after style of tenant.
In a cynical way, children are also living proof of an established relationship and provide a sort of ‘tie’ to the tenancy. If the children go to school in the local area and have established developing relationships, the parents are less likely to move elsewhere unless for employment purposes.
While less stable than family tenants, employed couples are also very desirable tenants. Established couples are more desirable (together for 5 or more years) as this shows that they are invested in one another and are not likely to move out due to a disagreement or divorce. Newer couples are less stable, as new couples who move in together have higher separation rates, so it is your call. Likewise with families, it is better if both individuals are working. Take care if only one of the couple is employed as at this stage in relationships it can be easy for things to become financially difficult, particularly if they are quite young.
While employment is key in the case of letting to a single tenant, it is also important to consider the style of employment to ensure you have a stable investment. If they are young and employed, normally with a menial job or a simple 9-5 that pays the bills, it’s starting to look a little dangerous. Often these types of tenants have no larger sense of commitment and greener pastures such as higher education or ‘a year abroad’ can often look tempting for these types of tenants. If your singleton is employed in a professional position, this is much better, as they have a sense of responsibility and commitment to their profession.
4. Student Households/Flat Shares
Student households and flat shares are often considered to be the see-saw of tenants. On the one hand, they are a secure investment throughout highly populated student cities, but on the other hand they can be far more stressful than renting out to regular tenants. Students are often only there on a short term basis and can sometimes arrive ‘fresh’ from their parents household, with no concept of paying bills, cleaning or even looking after themselves properly. This can lead to some nasty repair-work needed on student properties. However students will often pay more for the location, so it is entirely up to you whether or not you consider the stress to be worth it.
While at the end of the day families are in fact, the most stable form of tenancy, this is purely based on employment statistics and facts based on the likelihood of the family moving around. As in any situation there will be exceptions to the rule, and you might find that renting out to a singleton is providing far more worthwhile than a family of four or five. It all depends on the area in which you are located and how thoroughly you have vetted your tenant out. Still, there will be times when you get…less than desirable tenants and it is important to maintain a good working relationship with all your tenants. After all, happy tenants are more likely to pay their bills on time!
Article provided by www.timgreenwood-associates.co.uk, a Chartered Surveyors firm established by Tim Greenwood in 2012, after 21 years experience working in the Surveyor industry.