Property expert Phil Spencer has urged landlords to be reasonable when signing up tenants who get into a bidding war – but recognises that competition is down to market forces.
The TV presenter explains he finds it difficult to support the practice of prospective tenants bidding over the asking rent to secure a property and that if landlords want more money, they should ask for it at the advertised price.
But he adds: “No one has engineered this. It reflects the current state of the market and the need for good rental properties in the country, particularly in cities.”
Writing in The Telegraph, Spencer explains that a combination of increased service charges and mortgage rates means he is currently making no money on a couple of flats he rents out in central London, despite putting up rents. “My buy-to-let portfolio is a long-term investment that I hope makes some money in years to come,” he says.
He acknowledges that although private landlords are being squeezed on all sides and the era of cheap money is over, it’s worth “sticking with it” but admits he would probably not join the market today if he was starting out.
“However, once you’re in, you’re in. I am sure investing in rental properties is not a decision you took lightly, and exiting shouldn’t be one either.”
Although it’s safest to use agents and management companies, Spencer advises other investors to make sure they still have a hand on the tiller.
“My letting agent recently came to me with a prospective tenant who had various county court judgements against her. Rather than dismiss the application I spoke to her and her previous landlord who vouched for her good character and ability to pay and went ahead with the letting.”
Pic credit: Propertymark