When we think about rental agreements, we often think about six-month terms or longer. That’s because up until recently, most tenants and landlords have wanted long-term rental agreements - less hassle marketing and finding new tenants, less redecoration and cleaning costs in between. Tenants, for obvious reasons, generally don’t want to be upping and moving every few months.
However, there has been a massive shift towards short-term letting in the Tunbridge Wells, Tonbridge, and Sevenoaks areas. In fact, here at TN Lettings, we have around five enquiries a week about short-term lets. These are usually people looking for somewhere to stay in between selling their house and the completion of the next one or those who are undertaking renovations. After all, who can put up with all the dust and builders wanting endless cups of tea?
For landlords, it can be a lucrative business model. The buy to let sector has been hit by the section 24 legislation, meaning tax savings opportunities in buy to let properties have been restricted. Landlords also can no longer benefit from tax relief mortgage interest payments, which is making many look at short-term letting as a viable alternative to long-term letting. They are also useful if you are looking to sell your property but still hope to make an income from it in the meantime.
Traditionally, short-term lets are used for holiday rentals - people renting them for a week or two. However, we find ourselves in a rather unusual situation and for the first time in modern history, holidays aren’t allowed. No one knows when things will be ‘normal’ and how normal will look, and that has hit holiday rentals in the pocket - hard. Landlords have been clever and looked at ways that they can still benefit from people being in their properties without having tenants tied into a six-month or longer contract.
One of the most popular and most well-known ways of renting out a property in the short term is through Airbnb. Potential tenants or guests log into the website, find a property in the area, and go through the platform to rent it out for up to three months at a time. It is a great way of making sure your property is occupied during quiet periods or during situations like the pandemic - although, hopefully, the latter won’t be a problem again!
One of the major benefits of short-term letting is that landlords can command higher rents than if it was offered on a longer-term basis. Depending on where your property is, this can be as much as 30%. However, the downside is that tenants expect a higher standard of furnishing and amenities such as WIFI, TV license, and cleaning services to be included in the rental cost.
Of course, if you are hoping to rent out your property for more than three months or have tenants who want more than three months, you are better off sticking to a traditional long term let, possibly with a six-month break clause. However, if you are struggling to get tenants in your holiday let now, or want to reap the rewards of short-term tenancies, it is something worth considering.
At TN Lettings we are always happy to help with any lettings enquiries, whether short term or longer term. Give us a call on 01892 249070 or drop us an email at [email protected] and we’ll get right back to you.