Renting in Britain has never been harder. As landlords constrained by rising interest rates flee the market, supply has dwindled. The result is that for every available rental property, there are 22 desperate tenants hoping to secure it, according to Rightmove.
The situation doesn’t improve much for individuals hoping to sub into an existing house share either. On housemate search platform Spareroom, there are six applicants per listing. In short, these are dark times for Generation Rent.
Doomgazing aside, if you are a renter looking for a property, chances are you will need to do your best to stand out against dozens of others just like you. There are numerous ways of going about this – and not all of them simply involve throwing more money at the problem.
With the help of property experts and landlords, Telegraph Money outlines the different methods of outshining the competition for that rental property you need to secure – lest you retreat to your childhood bedroom, tail between your legs.
What kind of tenants do landlords look for?
At the most basic level, a landlord wants a tenant who won’t miss a rental payment – and also won’t destroy the property. Most landlords typically ask for a reference to that effect from your previous landlord, as well as details of your salary (and possibly several months of bank statements) to ensure you can afford the payments.
But Scott West, a buy-to-let investor, said the profile of his tenants is the most important factor in how he chooses them. “This isn’t simply how much they earn, but rather a more holistic approach,” he explained. “What do they do for work, what is their home setup, and how old are they?
“I specifically wanted younger families as tenants – they’re usually hard-working, motivated, and take good care of the property.
“Longevity of tenancy makes for a better relationship, and lower overall running costs – no marketing, agency fees, and less repair work when they leave.”
Clearly, whether you are a young family or a group of friends, renting is not within your control, so always check with a letting agent or landlord if they are dead set against renting to you, so you’re not wasting your time.
How do I ace a background check?
How much a landlord asks a renter to disclose about themselves can vary. Most are happy with just a reference from a previous landlord and your employer to prove that you are who you say you are, alongside confirmation of your salary.
However, with so many prospective tenants to choose from, landlords have liberty to be more picky. Michelle Lawson, another buy-to-let investor, said: “In my experience, the best and only way to assess a tenant is on quality and background checks by way of passing a good tenant referencing scheme.
“They need to have the right level of income to pass, a clean credit profile – or a good explanation of adverse records – a good history, a suitable previous landlord reference where possible, and be a suitable fit for the property.
“Landlords do currently have a large pool to choose from so anything prospective tenants can do to give the landlord comfort is a bonus.”
You might think this is a lot of information to disclose to someone who you may never meet if they operate using a letting agency, but – particularly in the current climate – the onus is on you to prove yourself a trustworthy tenant.
“Most importantly, be honest at the outset. Good landlords will find out things at some point, and honesty and integrity are big ticks, and will hopefully aid a good ongoing tenant-landlord relationship,” said Ms Lawson.
Should I offer to pay more rent?
Being a nice, reliable person only goes so far. What do you do when the other tenants gunning for your dream rental property are just as nice and financially secure as you are?
Greg Tsuman, of letting agency trade body Propertymark, said offering over the asking price may be the best way to get a landlord’s attention. “The market moves quickly. If you can afford to pay slightly over the asking price then of course it’s going to give you an advantage to secure it,” he said.
As for how much, Mr Tsuman said there “isn’t a formula”, adding that while a 5pc increase is a good start, some renters have been known to offer 10pc over the asking price.
Landlords are sensitive to the rapidly rising market rates, and “don’t set out underpriced to start a bidding war”, he said. “It’s not something we encourage – we hope landlords will price accurately.”
However, Mr Tsuman urges tenants not to offer beyond their means. “The first thing is to make sure you can afford the payments,” he said. “It’s very easy to get tempted to secure the property at any cost, but ultimately you’ll have to make the costs over a year or more.”
What about offering rent upfront?
Renters always pay a deposit, which is returned at the end of the tenancy (unless the landlord has grounds for keeping some or all of it – such as if you’ve caused damage), but as with private school fees, there’s nothing stopping you from stumping up some extra cash at the outset and paying some of the rent upfront.
From the landlord’s perspective, having more money means they don’t need to worry about you missing rental payments, and they can choose to invest it, or pay off more of their mortgage, for example. You can see why they would jump at the chance to have more money upfront.
“People are paying as much as 12 months, if they’ve got savings,” said Mr Tsuman. “You’d be surprised.”
However, Mr Tsuman says this behaviour is predominantly limited to affluent tenants who have sold their homes and are renting because it is cheaper than monthly mortgage payments. Sadly, smaller sums of money are less likely to have much of an effect.
“I’m not convinced offering three months upfront will give anyone a competitive advantage,” said Mr Tsuman. “Most landlords know that payments will come through – it’s more from a cash flow perspective, or a need to refurb the property that they might prefer a lump sum.”
Nevertheless, that tenants are so desperate for somewhere to live that they are willing to part with their savings is “quite a sad state of affairs,” Mr Tsuman added.
Lastly, be speedy!
Once you find a property you like, the quicker you can confirm your interest, send over the relevant documents and deposit, the better your chances are of securing it. Time is money, and your would-be landlord wants that property occupied and generating income sooner rather than later.
I hate landlords. Now I’m becoming one