Landlord Assist is warning tenants not to be tempted to overstretch their budgets amid reports that more and more letting agents are turning to high pressure tactics of ‘open days’ and ‘sealed bids’ to achieve record rent levels for the most sought after properties.
With the UK currently witnessing a shortage of properties on the rental market, agents are increasingly using these methods to reduce void periods and get the best possible rents for properties commonly in high demand.
According to the referencing and eviction firm, practices such as ‘open days’ and ‘sealed bids’ have proved highly successful for agents in attracting more viewings in a short period of time for the best properties and creating urgency amongst seriously interested parties which encourages them to act quickly or risk missing out on the property.
But many people are concerned that this form of marketing pits tenants against each other and creates a bidding war which can force rent prices beyond record levels.
Graham Kinnear, managing director at Landlord Assist says:
“At a time when demand for rented property is still high we are seeing an increasing number of agents using ‘open houses’ and ‘sealed bids’ to attract potential tenants to a rental property. Such tactics were once confined to areas such as Central London but market conditions are encouraging landlords across the country to adopt this approach.
“Although permitted, many people are concerned that group viewings have the potential to create a bidding contest between prospective tenants, and force a tenant to agree to a rent price at a level they might be unable to maintain in the long run simply because they don’t want to lose out on the property.
“We urge tenants attending an open house viewing, or who are seriously considering submitting a secret bid, to have a budget in mind, stick to their limit, and not be tempted to overstretch themselves just to secure their desired property. If a tenant overstretches their budget it could lead to them falling into arrears which could have a detrimental impact on both themselves and the landlord.”
Stephen Parry, commercial director at Landlord Assist fully expects marketing methods such as ‘open houses’ and ‘mass viewings’ to become more prevalent as the competition for the best properties remains fierce and agents try to secure the best deal for their clients. But he says the introduction of new Government initiatives which encourage landlords to expand their portfolio is the best way to expand the sector and control rents.
“Introducing measures that will put more funding behind buy-to-let will encourage landlords to expand their portfolios, provide more accommodation and achieve a greater balance between supply and demand. This would reduce the number of people bidding for each property, which would help to control rent levels and provide tenants with a wider choice.”
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