As a first-time landlord, one of the key things to think about is what demographic you wish to attract. This is worth spending time considering so you can then choose the right property with the right amenities to invest in. One group which is always popular with landlords is young professionals. But why is this group so popular amongst landlords?
The simple truth is that this kind of tenant comes with a few distinct benefits. One of the most appealing benefits is that they will be employed, unlike many students. Due to being in employment, you can be assured that young professionals will normally pay their rent on-time and in full each month. This is very attractive to a first-time landlord as it means you do not have to waste time chasing them up while you are learning the ropes.
Young professionals also tend to be more house-proud than students and less likely to hold wild parties and gatherings. This is better for your property as it is less likely to suffer wear and tear. As this demographic have the money and motivation to move into their own place, properties which appeal to them are always in high demand. This means that you should not have too much trouble renting out your first flat or house to this market.
Of course, the key to renting to young professionals is knowing what these tenants want from a rental property and how to market it. This guide will provide you with tips for making your property appeal to young professionals.
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Find out what amenities young professionals often consider when looking for a property.
Read about the types of locations young professionals look for.
Find out whether a bills-inclusive rent agreement is ideal for young professionals.
Read how to market your property to attract the attention of young professionals.
Frequently asked questions on how to rent to young professionals.
To answer this, you have to put yourself in the shoes of a prospective tenant from this group. Young professionals will normally be university graduates who are just starting their careers. Try to bear this in mind when deciding what property to buy or what amenities it should have.
– Fast and secure Wi-Fi connection for their mobile phones, consoles, PCs, tablets and laptops.
– A furnished property as this saves them time and money. As they are just getting started at work and might be there a lot, not having to shop around for furniture will go down well. Compared to an unfurnished property, this is a real advantage for landlords.
– Some kind of outdoor/green space to enjoy the summer sun and chill with friends.
– Plenty of power sockets to plug their electrical devices into (stereos, chargers, TV’s etc).
– Decent size kitchen space for them to cook and entertain.
– Ideally more than one bathroom.
As you can see, while there are a few specific things which young professionals value highly, it is not an exhaustive list or overly fussy. If you can make sure your property includes most or all of them, you should be able to attract young professionals.
As well as what is inside your property, most young professionals will place great importance on where it is located. Getting this right is a huge step for a first-time landlord wishing to rent their flat or house to young professionals.
When it comes to location, it would seem that city living and the lure of the bright lights is what most young professionals look for in the first instance. According to research from Lloyds Bank, young professionals are prepared to pay more to live in a popular location with lots of areas to socialise. If you take Scotland, for example, the ten most popular areas for young professionals to live are split between Glasgow, Aberdeen and Edinburgh (source). The situation in England is also similar, with London attracting 35% of young professionals (source). This shows that properties in popular cities are a good place to start for landlords in terms of location.
However, properties in these areas can sometimes be pricey. If you can’t afford these properties, the best thing to do is to buy properties in popular towns which are close to cities. Hove in England is a great example, as it is close to London, but offers boutique shops and a less frenetic pace of life. Locations like this are very popular with many younger professionals who desire convenient travel links into cities but might not want to live in the city centre.
Whatever location you choose eventually, any renter from this group will be looking for the same thing from it. This includes:
– Close proximity to nightlife, culture and places to socialise with friends of an evening or weekend
– Close proximity to schools if they have children to consider
– Close to the most useful local amenities like shops, doctors, dentists, cafes etc.
– Train/bus transport links so they can get into work and around in their personal lives without a car.
– Reserved parking space(s) can be handy to attract young professionals with a car.
– A safe area with a low crime rate and a sense of security.
When dealing with young professionals in the rental market, some things around the tenancy agreement itself can help attract them. Bill inclusive rent agreements are definitely worth considering with this in mind.
In simple terms, a bills- inclusive offer allows landlords to include bills in with the rental fee per month. This is not only simpler for first-time landlords who are still getting to know the rental market, but is also valued by young professionals too. According to research, most young professionals would rather get one set, inclusive fee for their rent each month, rather than having to budget separately for everything. If you are renting out a HMO (house in multiple occupation) property, inclusive bill agreements are even more popular with people. The modern HMO tenant is likely to be used to fixed price mobile phone contracts, Netflix subscriptions and other contracts, so will likely feel more comfortable with a fuss-free rent agreement.
The downside of an all-inclusive agreement is that it can place more work and more responsibility on the landlord’s shoulders. This is because you will have the job of arranging services, dealing with any problems and making monthly payments. This can be a lot to take on, particularly for newer landlords. For this reason, many will opt to use a utility bill management service to help.
With Split the Bills, you select your chosen services to include as part of the rent to your tenants. We will provide you with one monthly itemised bill to clearly manage your utilities, erasing any hassle. Our website also allows you to manage your account and monitor your tenants’ usage per property in our easy-to-use portal. You can find out more about how utility bill management services work here. If you are interested in our service to take responsibilities off your hands, you can arrange a consultation.
If you’d rather set up a non-inclusive rent agreement, you can refer our service to your tenants for a commission. Each tenant receives a bill for their share of household bills, making life easier for your tenants. We offer a monthly commission on every property you refer, year on year. You can read more about this service here, or arrange a consultation.
To get young professionals into your rental property, you need to let them know about it first! This is why marketing your property effectively is so important. It is also essential when marketing your property to do it in a way that young professionals will engage with. As this is an internet-savvy group, it is, therefore, a must to market your property online. It is also worth advertising via a traditional letting agent for faster results.
Being aware of how and what to advertise is key to successfully letting your property. Young people can sometimes have very busy lives and short attention spans. This means any advert you run must be snappy, concise and grab their attention. Any advertising should include high-quality images and showcase the features which young professionals will want. You should also give a rundown of the property’s main features, so they do not waste time on viewing a home that is not suitable for them.
The truth is that neither option is ‘better’ per se – it all comes down to what sort of tenant you want to attract. Young professionals come with a range of benefits such as being less boisterous, paying rent on-time & in full, being more house proud and generally being less hassle to look after. An advantage of renting to students is that they are less likely to be fussy about accommodation amenities. Student properties are also consistently in high demand, and you are not likely to be tied into long-term contracts.
The Millennial demographic is a large group, so this makes sense to target as a landlord. It gives you a bigger audience to appeal too and should help you rent your property out quickly. Millennials also tend to have a good career/income and value core amenities. All this makes renting property to this group more straightforward and potentially more lucrative, due to being able to charge higher rents.
This will depend on the tenancy agreement that is signed. If you opt for a non-inclusive deal, then the tenant is responsible. However, you should be aware that if they do not pay their bills, the energy supply to the property may be cut off and you will end up sorting the mess out!
If your tenants go with an all-inclusive agreement, the responsibility falls on you as the landlord. To help make this less hassle though, many landlords will use a utility bills management company to assist them.
We have explored the benefits of renting to professional, younger tenants – but are they any negatives? This is actually a group who do not come with many drawbacks at all for landlords. The only thing you may find is that they do not stay for long as pursuing a career can see them move locations or even save up enough to buy their own home. Although they do not like to party in the same way as students do, they are still social animals so may have the odd shindig in your property too.
This can vary depending on the tenant and what they want from a property. Many younger professionals seem to favour flats though as they give them their own space while being cheaper to rent and less work to look after.
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