Landlords urged to offer furnished town and city flats for higher rental returns

UK landlords seeking the best rental returns should look to furnished flats in towns and cities given the demand for these from young, mobile tenants, according to Countryside research. Users of Advanced Rent's tenant referencing services will be intrigued to read of the 8.1 per cent premium for furnished flats and the 2.8 per cent premium for furnished houses, compared to their unfurnished equivalents.

The report also showed a 3.7 per cent year-on-year rise in UK rents as of July, outer London being the major driver of growth. The letting agency also advised landlords that educating themselves on the properties that potential tenants are looking for and letting furnished properties in key areas would enable them to achieve higher monthly rental returns.

The greater profitability of furnished properties in towns and cities can be attributed to such areas having a younger tenant population. Such tenants typically possess little or no furniture, and are therefore willing to pay more for the landlord to provide it. This compares to rural areas, where there tend to be more families who already have their own furniture and therefore specifically seek out unfurnished properties.

Some urban locations of greater affluence even enable a landlord to attract a third more in rent from a furnished property than they could expect from an unfurnished one. UK city centre locations where landlords offering furnished properties have prospered include Salford in Manchester. Here, the rental market has been transformed by the influx of BBC employees willing to pay a premium for furnished flats in close proximity of the offices of the corporation that has partly relocated here.

Users of tenant referencing services like those of Advanced Rent will also be pleased by the continuing rise in average monthly rents in England, Scotland and Wales, which stood at £898 as of July 2014. Central London continues to enjoy the highest average monthly rent at £2,503 per calendar month. Year-on-year average monthly rent rises have been seen across almost all property sizes, the greatest increases being recorded for one bedroom properties, seeing a 4.2 per cent year-on-year increase and a 1.5 per cent rise on a month-by-month basis.

Nick Dunning, Countryside Group commercial director, commented: "Whether you are a first time landlord or a seasoned investor it is important to understand what tenants are looking for. This not only helps to minimise void periods but also assists in achieving the highest return from the rental property."

Editor’s Note: Advanced Rent (http://www.advancedrent.co.uk) is represented by the search engine advertising and digital marketing specialists Jumping Spider Media. Email: info@jumpingspidermedia.co.uk or call: +44 (0)20 3070 1959 / +34 952 783 637.