_What tenants really want: Tips on what to look for when investing in a buy-to-let property

To narrow down the types of properties you should be looking at in the area you've set your sights on, savvy buy-to-let investors should speak to a local agent to get a clear picture of which type of stock is in high demand and the current and projected rents achieved.

Cold hard figures and facts are the winning formula here, less so personal preferences or emotional attachments to a particular area. Remember, you're buying a property so that it ultimately works for you. 

For example, in Guildford there is huge demand for one and two bedroom apartments. Knight Frank recently launched 14 rooftop apartments at Tunsgate Quarter in Guildford town centre. There were 53 individual applicants view on the open day and we received 22 offers on the 14 apartments. 

For an investor, this is invaluable information on what type of property they should be purchasing and the likely timescales involved from purchase to finding a tenant, that tenant moving in and the client receiving rent.

What do tenants really want from an investment property? 

All tenants want clean, smart and well-presented properties but depending on what type of tenant you are hoping to attract, there are number of factors to consider and steps to take to secure a good tenant. 

The hard facts you can't ignore

Knight Frank's annual Tenant Survey interviews 10,000 tenants and paints an accurate picture of what tenants really want from a rental property. When looking at an area, affordability remains the key priority, but transport concerns follow close behind, with 35% citing the proximity to transport links or the ease of the commute to work as a factor. Just 3% or respondents cited a 'trendy' area as a key factor when choosing a rental home. 

With this key information, become bullet proof and begin your property search by looking at transport links and working your way outwards until you find a compromise between a price your can afford and location. 

Area

It may sound overly simplistic, but enter the mindset of your prospective tenant. What is important to them? Why would they want to live in a particular area? A young professional may put more weight on the vibrancy of an area and want to live near bars and restaurants and corporate tenants may value good transport links. Families will almost always need to live near to good schools and parks/open spaces. 

It helps to do extensive research into an area if you don't already know it. An area may well be 'up and coming', but, cheaper rent aside, will your prospective tenants really want to live there if they are cut off from transport links and access to work, friends or family? The adage really does ring true: location, location, location. 

Corporate tenants

A corporate tenant arriving in a new area will want an apartment which is well presented, fresh, bright, clean and ready to go. If works or decorating is required, this must be completed before viewings commence to maximise the price achieved and attract a good calibre of tenant.

New build homes/developments are a safe option especially as they are usually positioned in strategic locations, are generally hassle free and are a black canvas for modern tastes. 

Young professionals

Similarly to corporate tenants, a modern, stylish bright and low-maintenance property will attract young professionals; outdoor space is a always a crowd pleaser. Entertainment, nightlife and leisure may well top this demographic's bucket list so look for vibrant, 'trendy' areas that have easy access to transport links.

Again, speaking to a good local agent can make the difference between buying a property with long void periods or one with tenants beating a path to the front door. 

35% of tenant cite transport links as a top priority when renting a home

Families

If you're purchasing a house as a rental investment and hope to attract a family, the key focus here is good schooling - preferably 'Ofsted rated good/outstanding' within walking distance. Family homes tend to be situated away from central areas in order to maximise on space. A garden is a big bonus as well as being near to a park or open space. 

Students

If you’re letting to students, you need to start your property search in areas that are near universities/campus. Investing in student property in popular university towns/cities can be a lucrative move and it's worth speaking to a local Knight Frank agent who can guide you on what to buy and where. If you're looking to buy local to you, do your research on which areas are well known for being popular with students. 

A clean, bright and modern rental property is a must

Other factors to consider... 

Should I allow my tenant to 'put their stamp' on a rental property? 

Allowing tenants to make their mark on a property, such as by decorating, or adding pictures and photographs, can make it feel more like home which engenders long-term rentals. If the tenant is intending to stay long term, and so long as you set out what can and cannot be done, it is in the interests of both parties to let tenants decorate. Milllennial pink walls can be covered up later. 

Furnished or unfurnished? 

Furnishing is a key route to finding a good tenants quickly. We find that the asking price is almost always achieved when marketing a furnished property compared to the average 5% under asking price achieved for unfurnished properties.

However some tenants and in particular families may have their own furniture and need a blank canvas in which case you need to be flexible to secure the tenancy. Negotiation is key and for more information read our guide on how to present your rental property - furnished vs unfurnished. 

Layout 

Will your property by a single person, a couple or, say, three or four friends? An easy layout is important if there are multiple bedrooms - is the property conducive to shared living? For example, if outdoor space is accessed through one of the bedrooms this may deter potential tenants. 

Deposits 

Tenants want more choice and greater freedom regarding the deposit when moving from one rental property to another. The market is changing and there are now products on the market, for example Zero Deposit Guarantee, where the tenant makes a payment of one week's rent and the Zero Deposit Guarantee provides the same cover as a six week tenancy deposit.

More and more tenants are asking about these products as they speed up the rental process, free up cash and they can avoid having to fund a second deposit when moving from one rental property to another.

How can we help? Your local Knight Frank lettings agents have excellent knowledge of their areas and an understanding of the types of tenants that want to live there. For a friendly chat about what to look for and where, contact one of our offices.

Knight Frank Finance can help with all aspects of buy-to-let mortgages and re-financing so clients receives the absolute best rates often not available on the High Street.