The rental market is continuing to look strong for landlords as we head into summer, with Zoopla reporting a 7.8% increase in rental prices between March 2023 and March 2024.* Let’s explore how this increase benefits landlords and how a letting agent can help you increase rental prices correctly.

Benefits for landlords

Increased rental income

As inflation drives up expenses such as property taxes, maintenance, and insurance, landlords often adjust rental prices to maintain profitability and cover their investment costs. By making sure you don’t exceed inflation rates, you can remain competitive while still covering your expenses and improving your return on investment.

Financing property renovations

The additional rent income you earn from rental prices increasing can be allocated towards funding renovation projects aimed at enhancing the property’s overall value. These improvements could include upgrading appliances, improving energy efficiency, and modernising interior spaces, all of which can help you command higher rent prices and increase the property’s value to boost long-term profitability.

Mitigating financial risks

Increased rental prices also help you protect your finances and reduce the impact of unforeseen expenses, such as vacancy periods. Additionally, as you can allocate more funds to maintenance and repairs, you are less likely to encounter issues with your property in the future, further stabilising your income.

Why it’s important to set a realistic rental price

Tenant affordability

Although it may be tempting to significantly increase rent, it is important to keep any increases to a sensible level. Setting rental prices too high can outprice tenants and reduce the amount of interest in your property, potentially leading to costly vacancy periods. 

Tenant retention

Rental prices directly impact tenant satisfaction, so your current occupants are much more likely to stay in the rental property if they feel that they are receiving fair value for the rent they pay. If the rental price is too high, tenants could seek alternative housing options.

Market competition

An accurately priced rental property is a key component of remaining competitive in the market, as overpricing your property can deter potential tenants and lead to prolonged vacancy periods. Overall, setting a realistic rental price is essential to effectively navigate market competition, attract tenants, and optimise your property’s profitability.

How a letting agent can help you increase rent fairly

A letting agent can play a crucial role in helping you increase rent fairly by providing valuable market insights, professional guidance, and effective negotiation strategies. Using their expertise in the local rental market, letting agents can conduct in-depth analysis to guarantee that any proposed rent increase aligns with the current market conditions. 

Additionally, letting agents can advise you on the best timing and rate of rent adjustments to maximise rental income while remaining competitive and fair to tenants. By setting a realistic rental price that aligns with rental inflation, comparable rates in the area, and the property’s value, you can ensure that your property remains accessible and affordable for a broader range of tenants.

As we head into the summer months, the property market is continuing to bolster as an increase in market activity continues to benefit home movers. Let’s take a look at recent property market data and how the current market conditions benefit sellers and buyers alike.

Recent market data

According to Zoopla's house price index, there were 20% more properties for sale in March 2024 than the previous year.* There was also a 9% rise in sales agreed during this time period.*

This rise in market activity is partly due to an increase in the average working wage and an overall robust job market, both of which boost consumer confidence. In fact, confidence in personal finances has reached the highest level in more than two years, according to GFK's Consumer Confidence Barometer.** This made homeowners considerably more interested in buying a new home, therefore increasing market activity.

Benefits for buyers

More choice

An increase in market activity leads to a wider range of choices available for buyers to consider. This improved choice empowers buyers to explore various properties, compare features and prices, and ultimately make more informed decisions that align with their preferences and needs.

Price stability

The market remains well balanced as the demand for properties and the supply of homes for sale have equally increased. Because of this, prices are less likely to fluctuate, potentially making for a more stable investment. Increased market activity also helps to create a clearer picture of the true value of properties, further contributing to stable pricing.

More negotiating power

Due to increased confidence, buyers have the opportunity to be more assertive when negotiating a price for a property. Since the supply of properties is so high, buyers are less desperate to secure a particular property and can carefully consider their options.

More opportunity for investment

For those looking to invest in property, the increased supply increases their options massively. In a busy market, investors can buy a property, make renovations, and sell for a profit in a shorter timeframe.

Benefits for sellers

Increased demand

With more people in the market for a new home, sellers can command higher sale prices for their properties as buyers engage in bidding wars. By achieving a higher sale price, sellers can then look for a higher-value property than they previously considered possible.

Faster sales

The increased level of demand makes it easier for sellers to find potential buyers, which can lead to faster sales and less problematic property chains. Additionally, if a buyer is particularly interested in a property, they may be willing to pay a slightly higher price to secure a quick sale.

Flexible terms

Strong demand can give sellers the upper hand in negotiating certain terms. For example, if the seller needs to close the sale quickly, they can choose the buyer who is in the best position to complete the transaction as soon as possible.

Less pressure

In a balanced and active market, sellers may experience less pressure to accept lower offers or make compromises that they're uncomfortable with. They can feel confident that a more suitable buyer will soon show interest and make a better offer.

How an estate agent can help

Estate agents use their in-depth knowledge of the property market to assist buyers and sellers alike in taking advantage of summer 2024’s active market. They have access to a wide range of property listings and can help movers identify suitable properties that match their needs and preferences. They are also skilled negotiators who can secure favourable terms and prices while guiding movers through every step of the process.

Looking to expand your property portfolio before the year ends?

Contact us today for expert guidance on sourcing opportunities, negotiating effectively, and ensuring your next acquisition is a success.

Why Consider Vendor Financing

Some buyers may struggle to secure traditional financing. Offering vendor financing such as vendor mortgages or completion bridges can help serious buyers complete the purchase while keeping your sale moving. It’s a practical solution for motivated sellers and can widen your pool of potential buyers.

Types of Vendor Financing

Vendor mortgages allow you to lend the buyer part of the purchase price, while completion bridges provide short-term funding to cover delays in buyer finance. Each option comes with benefits and risks, so understanding the structure, interest terms, and repayment schedule is crucial before offering support.

Assessing the Risks

While vendor financing can facilitate a sale, it also exposes you to potential non-payment. Conduct thorough credit checks, consider secured arrangements, and consult a solicitor to ensure you’re legally protected. A careful risk assessment helps balance completing the sale with protecting your investment.

Legal Structures and Agreements

A well-drafted legal agreement is essential. This should outline repayment terms, security on the property, and consequences of default. Ensuring clarity on both sides prevents disputes and gives confidence to both you and the buyer, making the transaction smoother and less stressful.

Make your sale seamless and explore vendor financing options today

Government Proposals on the Horizon

This November, several key proposals are expected to move closer to implementation. The government aims to simplify leasehold ownership, reduce ground rents, and improve transparency for both buyers and landlords. Understanding these proposals now can help you plan and avoid costly surprises.

Timeline Implications

Changes won’t happen overnight, but the early winter period is critical for leaseholders to review their situations. Deadlines for applications, consultations, or opt-in schemes may be announced, meaning anyone with a leasehold interest should start preparing documentation and reviewing contracts. Early awareness gives you the advantage when the reforms take effect.

Cost Changes to Expect

Reform measures could affect service charges, extension costs, and lease valuations. Some of these adjustments may reduce long-term expenses, while others could create one-off costs for updating leases or legal work.

Action Requirements for Leaseholders and Landlords

Whether you’re a leaseholder seeking to extend or a landlord adjusting to the new rules, preparation is key. Reviewing your lease, seeking legal advice, and tracking government announcements will help you act quickly when changes become official. Being ready in early winter avoids last-minute pressure and keeps your property affairs in order.

Stay ahead of leasehold reform - seek expert guidance and practical next steps today.

New Procedures

The latest shared ownership reforms aim to simplify the process, but understanding the updated steps is essential. From initial eligibility checks to final completion, following the new procedures carefully ensures applications flow smoothly. Early preparation is particularly helpful this time of year, when councils and housing providers often face higher workloads before the festive season. Buyers who prepare in advance can avoid unnecessary delays, while landlords can ensure their properties remain compliant and attractive for shared ownership applicants.

Cost Implications

Financial considerations are always top of mind. The reforms bring changes to pricing structures, service charges, and staircasing rules, which may impact affordability for buyers and revenue expectations for landlords. Preparing a realistic budget now, before winter sets in, can prevent surprises later. For landlords, understanding the cost adjustments helps maintain compliance and avoid disputes while keeping properties marketable. Simple steps like reviewing current service charges, updating maintenance budgets, and planning for potential winter costs can make a significant difference.

Qualifying Criteria

Reforms often come with revised eligibility rules. Income thresholds, first-time buyer requirements, and local connection criteria may be adjusted, so staying informed is key. Early winter is a good time for buyers to check these criteria, gather supporting documents, and verify eligibility. Landlords and housing providers should be ready to advise applicants accurately, helping ensure that prospective buyers aren’t disappointed due to avoidable errors.

Application Processes

Applications are now more streamlined, with updated forms and digital submission options designed to speed up approvals. Yet, mistakes or incomplete documentation remain common obstacles. Buyers should double-check forms, prepare proof of finances, and follow guidance closely. Landlords and housing providers can support the process by providing clear information on property specifications and service charges. Completing these steps proactively in November helps avoid the bottlenecks that often appear as councils approach winter holidays.

Practical Tips for a Smooth Process

• Keep organised records: Maintain copies of all correspondence, proofs of income, and eligibility documentation.
• Plan your budget carefully: Factor in service charges, maintenance, and any staircasing costs.
• Communicate early: Stay in touch with housing providers to confirm deadlines and submission requirements.
• Act swiftly: Early action in November reduces the risk of delays as offices slow down for the holiday season.

Stay ahead of shared ownership reforms - take expert guidance early this winter.