As a property manager, you’ll know all about void periods. You know, when a property is left unoccupied and, therefore, bringing in zero rental income for you? Yeah, unfortunately, these painful times in a property manager’s life can creep up when you’re least expecting it.
Of course, this is far from ideal and mitigating the risks should be a top priority for anyone who rents out a property. After all, the last thing you want is a short-term void period turning into an ongoing problem.
So, without further ado, here’s HomeHero’s Ultimate Guide to Void Periods; what’s involved and how you can go about mitigating them.
What typically happens during a void period?
So, your tenant has vacated the property, and there’s nobody lined up to move in. The property is empty, there’s no rental income, and your investment is now costing you. But by how much?
Of course, this answer depends on a few things. You can determine the amount of rent you’re losing by multiplying what you usually charge with how long the property has been left unoccupied.
But there are also other costs you’ll need to factor in as well. These can include:
- Council tax
- Utility bills
- Remarketing the property
- Repair and maintenance work
- Screening tenants
- Additional fees, such as credit checks and drawing up tenancy agreements
And let’s not forget about your time—one of our most valuable resources. Trying to fill an empty property can eat away at your hours, so be sure to stay organised or outsource help where possible. It’s hard to put a price on time!
How can you mitigate void periods?
So, it’s clear to see the pain of void periods and why mitigating them is in your best interest. But here’s the catch: they’re also unavoidable.
As a property manager, you can’t guarantee you’ll never experience a void period. But luckily, there are plenty of ways you can minimise the chances, from building void periods into your budget to asking for a reasonable rent. Let’s take a look at a few examples.
Be a good property manager.
So, this may seem pretty obvious—but at times, property managers overlook this. The truth is, being a good property manager is one of the most effective ways of reducing your property’s chance of falling empty.
Tenants are more likely to continue dealing with someone professional, courteous and friendly. Remember, what’s a business for you is a place to call home for them—your tenants are your most valuable customers, so treat them as such.
Being respectful, polite and transparent are just some of the ways you can be a good property manager, which will undoubtedly help you when it’s time to…
Be upfront about tenancy renewals.
If you’ve established and maintained a respectful working relationship with your tenant(s), keeping them informed of any upcoming changes, such as their tenancy coming to an end, will go a lot smoother.
Don’t be afraid to remind them early about their contract ending, whether that’s three or two months before. Doing this will give you plenty of time to get a heads-up on their intentions and allow you to start finding new tenants within a manageable timeframe, should your existing tenants decide to move on.
Aim for longer leases and offer deals
But of course, long-term tenancies are always ideal—especially since the Tenant Fees Act came into effect in 2019. So, once you’ve bagged yourself a respectful tenant who pays on time and doesn’t cause you any problems, you’ll want to hold onto them for as long as possible.
So, for good tenants on a 6-month contract, you could always offer them a 12-month to ensure financial stability, for example. You could also offer tenants a 24-month contract if they’ve signed for a year. Extending your tenancy is an option too. Whatever works, right?
To mitigate a void period, you could also sweeten the deal by reducing their rent a little bit if they’re prepared to commit for this long. Over the pandemic, this is something motivated property managers have done to stay in the game—and it’s worked.
According to Foxtons, registrations of prospective tenants increased by 44% in Jan-Feb year-on-year, so it’s clear to see that discounts can do wonders for attracting tenants—especially if other property managers in the area aren’t already doing them.
So, whether it’s offering all-inclusive bills or 20% off the first month’s rent, you can turn the odds in your favour and get tenants to sign a contract quickly.
Advertise well in advance
If your existing tenants decide to move out, you’re going to want to advertise the property way before this day arrives. A reliable, professional letting agent will take care of this, but always ensure they’re using high-quality photos.
This is a must. Data shows that interest in a property will increase if decent photographs are showcasing it. We’re talking professional photographers who will ensure good lighting, angles and staging, and an eye for the property’s cleanliness. It’s the small things that can make a big difference.
Maintain the property
Lastly, maintaining properties is an excellent way of keeping tenants in them. To do this, make sure you or your letting agent inspects the property so you can spot any early issues, and you’ll want to conduct these around every quarter.
After frequent positive inspections on the same property/tenants, you can reduce these down to every 6-months. This will show tenants that you trust them and will complement the respectful relationship you’ve built.
You should also respond quickly to issues reported by the tenant. Not only will you avoid a more extensive repair job, but your tenant will appreciate the speed of your response. It’s this that may encourage them to extend their tenancy.
Don’t neglect to redecorate your rental property. While there is no fixed timescale to do this, it’s advised that property managers organise a freshen up every five years or at the end of longer tenancies.
Repainting the walls with neutral colours, investing in high-quality appliances and replacing any out-of-date furniture will always attract tenants. It may even help you secure a higher rent, as well as encouraging good tenants to stay on for an extra year. It’s a win-win.
HomeHero is an Operating System for the home, designed to make the lives of property managers and residents easy and hassle free. HomeHero covers a void period for up to 28 days.