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| There aren't many options when deciding what to do with a rental property, but the short-term rental option is proving to be an attractive choice for many residential property owners. |
Statera Estates director Ibrahim Braimah explains how changes in the residential property market are pointing towards new opportunities in short-term lets.
Property management within the housing market is changing. Fluctuating and changes offer both uncertainties and opportunities for private landlords. Previous changes in tax laws for private landlords and rising interest rates have been pushing some landlords out of the rental market. In contrast, proposed changes in UK planning laws to allow houses to be split in to flats under permitted development, and the rising short-term letting market offer opportunities. At Statera Estates, Ibrahim Braimah specialises in property management of houses and flats as short-term lets through platforms including Air BnB and Booking.com.
I asked Ibrahim these five quick questions:
1 What is the first thing to consider when entering the short-term letting market?
The success of managing properties through platforms like Air BnB depends largely on location. Before doing anything, analyse the location of the proposed property and what would drive ‘traffic’ to it. Ask ‘Why would people want to stay there?’
2 What are the pitfalls to watch out for?
Remember that short-term property lets are part of the hospitality sector rather than the property rental sector. Obviously more time and attention is required to manage properties this way, and the market is seasonal. Typically there is less income in the winter compared to the summer.
3 What opportunities are there to take?
Short-let online booking websites are are fantastic platform to generate business, but it is important to build relationships with your client guests when they arrive. This can drive future sales directly. Excellent customer service is essential!
Also, short-term lets don’t necessarily need to be over a few days. Building contractors and large businesses often require properties for up to six months or more on short-let agreements, depending upon their requirements to accommodate site operatives or visiting employees from abroad.
4 What is a little known gem?
Currently under Section 24 of the tax rules, properties that qualify as furnished holiday lettings can be treated differently from normal rental income. This means that if the property qualifies, private landlords can offset their full mortgage costs against their income, which is not possible under standard traditional tenancies.
5 What is your favourite success story?
We took on a two-bedroom flat in Elephant and castle which had stood empty for two years. It was in a poor condition after being abused by its previous tenants and the owners had lost confidence in the traditional rental market. Statera Estates took the flat on, managed its refurbishment and now market it as a short-term let under Air BnB. The monthly income has always exceeded the equivalent traditional rental value, bringing in twice as much in winter and three times in the summer. The owners are very happy.
Statera Estates offer a full service for short-term lets, currently focused on Central London and surrounding areas. Ibrahim also coaches landlords on how to get started in Air BnB property management, for those who want to manage their own properties. He said the short-term letting space is strong and competitive but it is still a healthy competition and good environment to be in.
https://www.stateraestates.co.uk/
Both Statera Estates and DesignBox Architecture are members of BNI Guild in London, UK. Here we form part of a wide group of specialists who can assist with a range of property-related services.
