Here are our top tips to help reach pricing decisions:
- Get the right advice: A sensible pricing strategy can make all the difference – and seeking out an agent who has significant experience in the local market, along with relevant comparables, should result in a well-thought-out rental valuation. Asking agents for their recent track record as well as what properties let for versus their asking price will help indicate whether they are launching them at a fair price. It can be tempting to appoint an agent who comes in with the highest valuation – but ultimately, it may not be the best choice in the long term. A good agent should be focused on achieving the best price possible for your property, putting forward pricing recommendations which align with market conditions and guiding you through the process.
- A price-sensitive market: Tenants are more clued up than ever – and will often be shopping around to find a property that suits their needs. Many will have done their homework in advance of a first viewing and have a clear idea on local rental values and what they are prepared to pay for a rental property. Tenants active in the market may only decide to move if it makes genuine financial sense for them to do so, meaning pricing plays a major role in their onward plans. Setting an asking price too high could mean missing out on potential tenants whose searches are set to a specific price point, so it’s key to market at a reasonable level that will result in enquiries.
- Asking prices and the Renters’ Rights Act (RRA): The introduction of the Renters’ Rights Act earlier this year means that landlords aren’t permitted to encourage or accept bids over the asking price where the listing could give rise to an Assured Periodic Tenancy. Getting considered advice from an agent on a pricing strategy that is likely to be market appropriate has therefore never been more important.
Avoid a void: It’s understandable that today’s landlords will want to achieve the best possible price for their property. But launching too high could mean little to no interest and, as a result, a longer void period between tenancies which can end up creating a false economy. In order to avoid this, it could be worth marketing at a more competitive price point which is more likely to attract interest early on and means the property won’t sit empty while holding out for an offer.
Don’t sit on the shelf: Launching and sticking with a strong price could mean that a property is marketed for a considerable period of time, often with limited viewing numbers and a lack of offers. Potential tenants will pay a keen interest in the marketing timeline and a lengthy one can deter them from enquiring about a property as it can create uncertainty about why it hasn’t let. Coming to market at a sensible and competitive price point should help to prevent this scenario.
