A new survey suggests that landlords can benefit by renting to families, as the data reveals that homes rented to them take up the least amount of property management time when compared to other types of tenants.
The findings come from more than 1,000 responses to the latest quarterly landlord research panel from the National Landlords Association (NLA), which asked them to estimate how much time they spent on property management, including things like dealing with tenant queries and property maintenance requests, and general business administration.
The NLA’s quarterly landlord research panel, which has been running for more than a decade, is the most comprehensive and longest running panel of its kind.
The research findings show that landlords who rent to families and young couples spend on average one full working day a week (8 hours) on property management. In contrast, landlords who let to migrant workers, benefit recipients, or who have executive lets, can expect to spend up to 12 hours per week.
Regionally, landlords in the North West of England spend almost twice as much time per week (10 hours) managing their business than landlords with properties in the South East of England (five and a half hours).
The findings also show:
- Landlords with mortgages spend on average three and a half hours extra per week on property management compared to those who are mortgage-free (eight and a half hours vs five hours) – a working calendar month extra per year
- Landlords with energy efficient properties (EPC rating of D or above) spend two hours less per week on property management.
Richard Lambert, CEO of the National Landlords Association (NLA), said:
“This data reinforces the fact that families make good, reliable, and long-term tenants, but some landlords can be put off by the perceived risk of more damage or wear and tear to the property or its contents.
“However, if you’re properly maintaining the property then tenants will be more likely to stay for longer anyway, particularly families who typically seek more stability. This is just one more argument for establishing a proper maintenance schedule in the first place.
“Landlords who rent to migrant workers or provide executive lets may find it takes up more management time because there’s a greater churn of tenants which means re-marketing the property, drawing up tenancy agreements, and conducting property viewings more regularly”.
The NLA also says that another big cause for concern is that those in receipt of benefits take up more management time for landlords. Mr Lambert continued:
“The combination of welfare cuts and the introduction of Universal Credit make it difficult for some benefit recipients to keep up with rental payments and that often means taking more time for the landlord to manage. It’s frustrating for everyone because the issues can be outside the control of both tenants and landlords”.
Insurance Edge comment;
More research on the overall costs involved in managing and housing various tenants can only be a good thing for the insurance industry. In the same way that AI, data processing and personalization of cover is disrupting and changing car insurance, landlords can be offered insurance based on the property history, as well as the tenant’s own financial and claims history.
Future regulation, such as making tenant contents insurance a legal requirement, might be necessary in the long run to stabilise the rental sector. Many private landlords are now trying to gradually exit the market due to the overheads involved in managing property. Property values seem to have peaked in many parts of the UK, which also makes buy-to-let it a less attractive investment than in the past.
Although councils across England and Wales are frantically approving as many apartment building projects as they can, in the longer term only a huge social housing programme can solve Britain’s housing shortage. For political reasons that is unlikely to happen and the market will gradually split into company-run portfolios marketed to those with jobs and good credit, while others will be pushed into increasinlgly underfunded housing trust and low quality privately owned flats and houses.