All Landlords want their properties fully tenanted - that's our primary goal too - but the true cost of holding an empty property could be more than you expect.
It has been reported that in 2016, 200,000 homes stood empty in England for at least 6 months, that's property with total value of £43bn. Not only have that but a whopping 11,000 of those homes stood empty for at least a decade!
In an economy with a housing crisis, this is far from good news. Of course the reasons vary from case to case - from something minor like the lull when a property is awaiting a sale, to more serious reasons such as the property being in disrepair - but the fact of the matter is that there needs to be fewer unoccupied homes. In a league table of the 2016 results, London is the worst offender, followed by Birmingham, Bradford and Liverpool. The fifth on the list is our fair city of Leeds with over 2,500 homes with a value of £560m.
We take a closer look at what impact having an empty rental property could have for a Leeds Landlord.
Probably the biggest and most obvious cost for Landlords is of course the mortgage. No matter what kind of mortgage you have, every month your property stands empty is another month you are losing out. It's not just a mortgage with monthly fees, Council Tax is another expense. When it comes to utilities, there may be costs here too. While obviously these won't be as large as when someone is living in the house, you'll need to bear in mind any charges accrued during the void period. It might be that you continue to use a small amount of electricity and heating (for example to keep some lights on with a timing switch, or the heating on low to prevent burst pipes in winter), alternatively, some utility providers will levy a standing charge for maintaining the supply, even if there is no usage. Combined, these are costs you will need to account for when calculating the cost of your empty property.
It is very important to insure the property, even if it is vacant, to protect against damage from storms, floods, fires and theft as well as things like vandalism. Most insurers have a clause that insist the property is not left vacant for longer than 30 or 60 days maximum or the insurance will not be valid. Check the ins and outs of your own particular policy for the exact dates, but if it will be empty for an extended period, you'll need a different kind of policy. Look for specific 'Unoccupied Home Insurance' or 'Empty Home Insurance', often the insurances is sold on a 6 months basis (because in the most part homes don't stay empty all that long) so you might not even have to pay for a full year. This article from MoneySupermarket has pretty good information.
If you are a Landlord, you'll already know that the quality of your accommodation correlates directly to how easy it is to find a Tenant for the property. If it's empty, then this is the perfect time to make improvements without Tenants in the way. Redecorate, make repairs or even go as far as doing some refurbishment. This kind of investment can make the world of difference to how quickly your property lets, the level of rent you'll be able to ask for and will minimise the void period. We have worked directly with a number of Landlords to help make improvements to their property. Because we know what the Tenants are looking for in a property, and have a really solid network of reliable contractors, we can help to get yours up to scratch. Take a look at our refurbishment page for more details.
At the very least, it's time for a lick of paint and a good deep clean but if the property is standing empty for a while, youf€ll need to clean every so often to keep cobwebs at bay and the property looking its most attractive for prospective Tenants.
Even if you aren't going to do much on the inside, remember you need to keep on top the garden - to only to maximise the 'curb appeal' to new Tenants but also to make sure the property doesn't look empty, which can make it a target for vandals or squatters.
There are a number of steps you can take to help keep your property secure while it is empty. These include the basics such as installing security systems and decent locks, making sure the property doesn't look empty by keeping it in a good state of repair as well as remove all valuables from inside and visiting regularly to check on it. From a practical perspective, remember to drain the water system, keeping the heating on low in winter and consider timing switches on the lights to keep it looking lived in. If you have a driveway, you could even ask a neighbour to park their car in it, or even rent it out for some extra income!
If you have had an empty property in Leeds for some time and don't know where to start with it all, Let Leeds work with a not for profit organisation called Empty Homes Doctors. We can advise and create a strategy to help you get the most out of your property, whether it be selling, renting or refurbishing, we can provide a full 360 degree service. Empty Homes Doctors are great as they provide some excellent tips on how you can reclaim VAT and what interest free loans and grants are available to those with empty vacant properties.
Hopefully this will help you be prepared if you rental property is left empty. Alternatively, if you need a hand finding new Tenants, for a student property or a professional property, then give us a call on 0113 320 2000 and we'd be delighted to help you.
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