The property market in 2020 has been dominated by news of the sales market. This is unsurprising, especially given that house prices have witnessed their highest monthly rise in over 15 years thanks to the stamp duty holiday.
However, the lettings market has also made big strides. According to Arla Property Mark, July saw the highest numbers on record for tenant demand and the number of properties managed and has remained stable despite the economic downturn. These surges represent a key opportunity point for property managers to benefit from going into 2021.
Increased demand, increased competition
Following months of uncertainty, the market is beginning to stabilise with prospective tenants eager to secure lettings. This has created a competition pool that is vital for property managers and landlords.
Rising demand and competition opens the door to properties being let for a higher rental price. Better communication, payment security and reduced potential fees all place property managers in a favourable position to efficiently benefit from market upswings.
Tenants are staying longer
The level of competition has made securing a long-term tenancy more attractive for a tenant. As per the Arla Property Mark Report, the average tenancy length hit an all-time high for the month of July.
Long-term tenancies reduce the potential fees involved in finding new tenants on a more frequent basis. Having a smaller gap between tenancies encourages a more regular, stable income from the rental property.
Landlords have been called upon to be more flexible given the current economic downturn as a result of the COVID-19 pandemic. By creating trust and confidence, the likelihood that tenants look to move reduces.
As such, flexibility and a transparent rapport with tenants can work to achieve a stable tenancy. This additional layer of cohesion between both parties is financially beneficial for managers with regards to the rental incomes.
Additionally, being flexible prompts the need to streamline management processes in order to maximise potential earnings. By reducing the time spent on tedious administrative tasks, labour costs decrease and valuable time that can be focused on profitable areas increases.
A key consideration with a digital answer
Effective communication with tenants is critical during the COVID-19 pandemic in order to make sure rent payments are consistently made. The ending of the furlough scheme will make good communication between property managers and tenants even more crucial.
Consequently, digital solutions are becoming more favourable for the lettings journey. Automated reminders, secure cloud storage and centralised communication allow managers the flexibility to let their properties as efficiently as possible and benefit from the recent trends in the letting market.
Find out how Arthur can help you streamline your property management. Try 30 days for free.