The term ‘accidental landlord’ has become extremely common throughout the United Kingdom in recent years. Accidental landlords are defined as those who have attempted to sell their property for some time without having much success. In these circumstances, some will choose to rent the property privately and benefit from a rental income rather than sit and wait for the right buyer to appear.
A report recently published by property analysts, Hometrack found that despite low rates being offered on mortgages, buyers are dragging their feet when it comes to signing on the dotted line. In fact, its findings concluded that there was a 23% decrease in buyers registering with Estate Agents in the period August 2011 – January 2012. Couple this with Land Registry figures which show a 1.3% decline in house prices since December 2010 and it’s easy to see why the term ‘accidental landlord’ was coined.
While experts like property portal RightMove are suggesting that the market is fragmented and citing the emergence of ‘micro-markets’ around the country, the reality for many homeowners over the last few years is that a stagnant market has eroded confidence, often resulting in the For Sale sign remaining glued to the exterior. Faced with a choice of lowering prices, waiting out the slump and continuing to pay a mortgage on a home they no longer want to live in or taking advantage of the property rental boom, homeowners in their thousands have opted to cash in.
Although a new career as a landlord may not even have seemed like a remote possibility 12 or 18 months ago, it’s not all doom and gloom for those now finding themselves accidental landlords.
The benefits of being an accidental landlord
While selling homes has proved difficult for some, buying has become even more so. As a result of record levels of unemployment, poor consumer confidence and more stringent than ever mortgage requirements, millions of would be homeowners have found themselves renting instead. A report commission last summer dubbed ‘Generation Rent’ found that two thirds of non-homeowners despaired of ever buying and had resigned themselves to renting.
The net result is record-breaking rental yields – the average private rented property in England and Wales now amounts to a staggering £717 per month. For landlords (accidental or not) rental yields of this magnitude are often enough to cover the mortgage repayments on the unsold property.
Particularly in such turbulent times for the property market, renting a house privately with the ability to command such high rental income gives breathing room to wait for the market to improve and house prices to go up before attempting to sell for a second time
Renting out a private property that hasn’t sold also frees up the accidental landlord to move out, without the worry of leaving the house or flat unoccupied.
For those considering becoming private landlords for the first time, I Am The Agent, a revolutionary fixed fee letting agency in the UK, are experts at preparing a property for private rental and know what is expected of a landlord, from the organisation of paperwork to the house itself.
I Am The Agent offers a choice of packages, with the option to go it alone and manage the rental process independently or to use the services of experienced agents in the Greenwich Estate Agency.
In keeping with any intention to sell the property eventually, I Am The Agent also offers a fixed fee house sale package of £299.