By Rebecca AtkinsonResearch from Landlord Mortgages shows that letting agents in some regions of the UK are overstating rental returns on investment properties by up to 25%. Posing as tenants and potential property investors, researchers asked how much a two-bedroom flat in specific developments could be rented for. While London at 25% and Birmingham at 13% boasted the most inflated prices for the second year running, other areas of the country showed a different trend. Letting agents in Manchester and Liverpool massively under quoted potential rental returns at -25% and -15% respectively. For the second year running Sheffield appears to have the most honest agents who quoted the same to tenants and investors. The trend is for agents to quote approximately the same to both classes of callers compared with an overstatement of 8.5% last year. This indicates a more cautious approach by letting agents, perhaps brought on by increased competition to find rental properties. Lee Grandin, managing director of Landlord Mortgages, says: “These results show it is still crucially important for landlords to thoroughly research prospective properties before making purchasing decisions. By relying purely on the advice of letting agents some investors may be facing a serious rental shortfall or even be put off a perfectly good property by an overly pessimistic assessment. “Other feedback from the research shows that extra features such as allocated parking can boost expected rental income as more people will be tempted to move away from the city centres. Investors who thoroughly research their investment looking for features such as these can expect higher rental income and fewer void periods.
Dear Delia My client bought a buy-to-let property early this year and found what seemed like good tenants – an unmarried couple.
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