Should I rent to a student without a guarantor?

You asked: Should I rent to a student who can not provide a guarantor? https://t.co/9bDM4w8bux

— RLA Landlord News (@RLA_News) May 7, 2018

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The best yields for buy-to-let revealed

As a landlord have you ever wanted to be show where the best yields across the UK are for buy-to-let?

Sheffield City Centre best for yields?
The postcode S1 which for those in the know has the best yield in the UK according to the totallymoney website.  For those in the know this is not surprising.  Sheffield city centre like many provincial city centres is benefiting from a boom in rents as International students from the likes of China and the Middle East bid up the cost of renting the best quality new apartments.  The average rent is showing as £645 giving a yield of over 11% on the quoted capital value of just under £60k.  The reality is that to achieve that kind of rent a landlord would be looking at paying over £80,000 for a 2 bed apartment and that after paying the ground rent and service charge a landlord would be lucky to have £500 in their pocket each month (even less if they had a mortgage).  The figures have been distorted by the large number of ex council properties in the area that would only be suitable to LHA tenants.

International students a lucrative market
On the recent Letting Essential Course I was talking to one newbie landlord that had created her own specialist letting business by letting new builds almost solely to these types of tenants on a 12 month Assured Shorthold Tenancy Contract.

Dangers of letting to international students
The danger with international students is it's very difficult to insure against bad debts.  If they disappear off to China then how will you get your money back.  Even a guarantor agreement is not likely to be much help.  So far she has been lucky so fingers crossed.

The yield table is an interesting  tool but like all statistics a landlord needs to delve behind the headlines and understand what they really mean.

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Guarantor forms - thumbs up!

Our gaurantor forms get the thumbs up from the Evening Standards 'accidental landlord.'

It's always nice to be appreciated, so when the Evening Standards accidental landlord AKA Victoria Whitlock describes Property Hawk as 'fab' we at PH are feeling rather pleased.

If you are looking at obtaining a tenant guarantor form then follow the guidance in the Landlords Bible or give Victoria's column a read.

Free property management software, Free tenancy agreements

Young Tenants Gamble

I've just had notice from one young tenant.  Chris I guess is about 26 and he's moving in with his girlfriend.  This is one of the issues of letting to 20 something tenants.  They often rent for a short period of time before moving on.  In the past this was probably to buy a property with their partner.  Now it's more likely to be to rent a larger property with their partner if they started by renting a one bed property.

Property re-let very quickly

The good news for me is that my letting agent Express Lettings was good to their name and was straight on the case and has re-let (subject to references) to two new tenants.  If I was worried about letting to Chris being a little on the young side.  The two new tenants are much younger.  One is 20 the other 18.  So is this a good idea?

Now I've let to young couples before.  It's a high risk strategy in that young relationships don't always last.  This isn't good for the longevity of your tenancy.  The plus side is that if things work out then at this young age they probably won't be moving on for a number of years.

Guarantor is a must

I would never have even considered letting to a couple so young without the comfort of a tenant guarantor.  A good sign was that one of the accompanying parents volunteered to act as a guarantor without being asked.  Subject to both parties passing the referencing test I hope to have this property let by the middle of March.  This new tenancy will make three of my tenancies that have been subject to a tenant guarantor.  In the current uncertain economic environment with young tenants being particularly vulnerable.  Having a tenant guarantor is a valuable weapon in a landlords arsenal.  I urge landlords to use it.

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