Are ‘Olympic Lets’ a Good or Bad Idea for Landlords?
With the Olympics now being less than 100 days away one question we have been asked many times by our clients over the last few months is whether or not they should be offering their property as a short term rental over the period of the games. Having a look online it is clear that there are large numbers of people who are hoping to secure short term tenants paying premium rents over the duration of the Olympics. The potential advantages are clear in terms of the financial side but there are also a number of drawbacks which is why we have been advising our clients against proceeding down this route.
The prospect of achieving four of five times the normal rent is obviously very appealing but it is important to think about how much of this the property owner will actually receive in their hands. The first thing to consider is that Letting Agents are charging higher fees for short term lets with many of them are charging around double their standard charges. The rents will also be inclusive of all utility and council tax bills which will mean that the property owner will need to pay these bills.
The other aspect to consider on the financial side is that going ahead with an Olympic Let will inevitably mean that there is an increased void period on the property. You will need to regain possession of your property at least a week before the ‘Olympic Let’ is due to start in order to ensure it is cleaned and presented to a sufficient standard for the new tenancy. Perhaps the biggest drawback is that in the period immediately after the Olympics there is likely to be a number of properties that come onto the market at the same time which will result in increased competition for tenants and a possible dip in rents and extended void periods.
A final point to consider is that most properties will require additional furnishings in order to be suitable for a short term rental. Although the majority of rental properties in the area are furnished anyway a short term tenant would require additional items such as towels, bedding and a television etc. Supplying these items will of course have a time as well as a financial cost and this will also need to be taken into account when calculating the potential returns.
Taking all of the above into account it becomes clear that the potential returns are not as high as they first appear and this is why the majority of Landlords have decided against going down the short term rental route. This is without considering the additional wear and tear that would be caused to the property and also the fact that it would be very difficult to monitor the identity and numbers of people who are in the property. The Olympics will offer rental opportunities for some people but the people who are probably best placed to benefit from this are owner occupiers who are prepared to offer rooms to let within their family homes.