Sophia's goodbye present - Her first (and last) blog - Why we can guarantee 6 weeks to let a property at YPC
Brett Alegre-WoodChairman, YPC Group
Hello,
Since I started at YPC I have been helping look after the lettings and as this is my last week at YPC I thought I would leave with a few words of wisdom on this topic. Now YPC guarantees to get your property let within six weeks*. So how are we so confident that we can achieve this?
We employ a multitude of proactive strategies. Firstly we aim to use local agents that we can build a strong, symbiotic relationship with: 'you scratch my back and I can scratch yours!' On initially speaking to the agent we send them all the details of the development and let them know what our expectations of the Realistic Market rent (RMR) are. Often this is in line with their thinking and what can and will be achieved. Other times they may suggest marketing even higher. We aim to launch advertising 2 weeks before completion at a higher price (£25-£50 more than the RMR) to gauge some initial interest.
We also negotiate the letting agents' fees down (making things cheaper for you) due to the prospect of bulk properties and continual business with them. Indeed a lot of agents are keen to please and work very hard for us. However the key here is our management of the process along the way.
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We speak to the agent a minimum of every 2 days and then follow up on the viewings that they have had. YPC puts pressure on the agent 'squeeky wheel' so that they prioritise your property. We get constant feedback and any offers that come through we will negotiate a price and a move in date.
One of our strategies is to also foster competition within the agents- we only ever put 4 properties with any one agent at a time so if we find the agent isn't performing we will move the properties over to another one. This is a slight euphemism for 'You've been fired!' Alan Sugar style!
We also advise that if an agent has 4 properties to let that they only actively advertise one or two. Simple supply and demand here...if you go on to Rightmove and see 10 properties from the same development advertised one would be less likely to book in viewings. Its human nature.
One thing I have learnt here is that agents will often Sell up and Manage down. When you call up first of all they sell you the world and then once they have your business they manage your expectations down â?? saying things like lettings are slow or the lounge isn't big enough etc. Our experience in dealing with a multitude of letting agents means we are attuned to this.
In fact there are really only two reasons why a property won't let:
1) The agent is not doing the job properly e.g. advertising on line, in the window or in the local paper - which ever reflects the most proficient marketing tool for their area. Key to a good agent is also to have lettings managers who are proactive, communicative and persuadable.
2) The property is at the wrong price. The price needs to reflect the property itself as well as the current state of the market. Simple supply and demand will see fluctuations of rental price in the lettings market.
So once you have a good agent and a good price you are good to go!
If it's been 3-4 weeks and we are confident that the agent is working hard then we will consider dropping the rent by say £25pcm and then by perhaps another Â?25, 2 weeks after this. This will ensure that your property gets chosen over others that are similar but at a higher price.
We aim for a quick let as from an investors point of view it is a lot more favourable to get a tenant in sooner rather than later thus reducing the risk of a larger void period. If you held out any longer you may never achieve that slightly higher rental anyway 'what fools do in the end the wise do in the beginning'. Please note we would never drop the rent too substantially as we do not want to attract the wrong calibre of tenants. We guarantee to get the property let within £50 of the RMR and use this lee-way to bag you a tenant. Often (after 4-6 weeks on the market or over Christmas) we will even consider an incentive such as the first month's rent half price (everyone likes a bargain). Indeed if you waited around and did not consider an incentive it may cost you another 2 weeks anyway, working out financially the same.
With YPC as your main point of call we take the every day hassle of being a land lord. It's about putting trust in professionals; this is a strong theme in the book the Richest Man in Babylon, which should be compulsory for every investor to read. And as an investor one should release control and let YPC do what they're good at and what they are paid for!
For me I find that all these principles and strategies work and indeed YPC rarely pays out on the guarantees and has even recently expanded on them to cover the first 2 years of your ownership. Brett's a smart guy and I know that because of the principles in this blog and the training we have that he will rarely have to pay out on these extended guarantees either!
Anyway questions please do not hesitate to contact the team on 0207 812 1255.
Kind regards
Sophia Philippou
Senior Property Manager
Brett's Note - Sophia has finished up now and moved to Australia to follow the sun and her boyfriend. Despite me calling her a 'traitor' for the last month of her work she will be missed.
*8 weeks if flooring is required or if over holiday periods.
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