The private rental sector (PRS) appears to be continuously increasing as millennials stray further away from the property buying market.
With the market of millennial renters expanding continually, we wanted to offer some hints and tips for both tenants and landlords. Here, we look at the current renting landscape, insight into what millennials are looking for in a property and how landlords can provide this for them. Keep reading for more tips on maintaining a harmonious relationship with your tenant.
The rise of the millennial renter
With the long-term trend of rising house prices, it is no surprise that millennials now make up the dominant demographic within the rental market. According to the ONS, 43% of private renters are aged 16-34.
The survey also found that only 42% of private renters aged 25 to 34 expect to buy their own house in the future, showing that the amount of renters is likely to keep increasing, with more people joining the market than leaving it.
Profile of the millennial renter
Millennials currently make up a majority of the housing market. For landlords in 2022, it’s important to acknowledge the profiles of this group to appeal to their lifestyles and desires. A millennial is anyone who reached young adulthood (18-25) in the early 21st century.
Many tend to own animals, so allowing pets – although a controversial topic since the Tenant Fees Act – can improve your property’s popularity amongst millennials.
Many Millennials are also eco-conscious, so energy-saving features are very popular amongst this demographic – good insulation, eco-efficient bulbs, and bike storage space are all great options.
Millennials also prefer to communicate via text or email, so this is important to consider if you have a millennial tenant and need to contact them.
Renting versus buying for the millennial tenant
The renting versus buying discussion is an ongoing debate that can present several arguments in favour and against both sides. The main advantages of renting over buying include more flexibility in location, no (or little) responsibility to perform maintenance or repair work, and smaller down payments or deposits. While these have long been identified as benefits, they are particularly prolific for the current housing demographic.
The main advantages of buying are having complete control of the property and long-term stability. Homeownership is becoming increasingly difficult for more and more renters thanks to rising house prices, conveyancing costs and removal fees. Millennials find themselves in a costly situation that their salaries often can’t match, and more are renting through necessity rather than choice.
So what are some of the other main benefits of renting?
Flexibility is one of the main advantages of renting over buying for millennials who might not want to put roots down in a permanent location. With fluidity in the job market and an increased desire to travel, entering into six-month or year-long lease contracts is a much more viable option.
Chance for diverse cohabiting - Renting a property not only opens up flexibility on where a tenant can live, it also means they have more flexibility when changing who they live with over a period of time. From friends and family to romantic relationships, renting leaves room for versatile and adaptable living arrangements.
An alternative to the property ladder can also be beneficial to some. The past few years have been difficult for first-time buyers to get onto the property ladder. This has led to a surge of people opting to rent instead. Many millennials now view renting as a long-term housing solution, not the short-term temporary arrangement it has been in generations previously.
The importance of safety
A study of millennials in the housing market revealed that 76% reported safe streets as a priority when picking a place to live. This demonstrates that it is now becoming increasingly important for landlords and letting agencies to both provide and promote the safety benefits surrounding their properties.
This shows that its crucial to consider the surrounding area when purchasing a new buy-to-let property. Landlords can also improve the safety of their existing properties with outdoor lighting, double-glazed windows, alarms and annual gas safety checks.
Other ways to appeal to the millennial renter
While safety seems to be coming out on top of the ranks, other features are regularly cited as being beneficial to the millennial way of living, including bike storage, allowing pets and off-street parking.
Another feature particularly attractive to eco-savvy and money-conscious millennials is any steps taken towards reducing the cost of utility bills and the expense of energy. Landlords can appeal to this by opting for double glazing, fitting cavity wall insulation, installing thermostats or programmers and updating their heating systems.
The added extras that count
One thing that is also becoming increasingly apparent is that the millennial tenant wants more than the bare necessities and is looking for added extras before entering into any tenancy agreement.
Gone are the days of picking out a property to purely supply for basic needs, as renters now keep a close eye on things like interior decor, location, technological features and more flexible attitudes towards diverse lifestyles.
To really set your property apart from the rest, some great luxuries to include are things such as underfloor heating, provision and maintenance of white goods and outdoor spaces.
Once you’ve entered into a rental contract, there are several things you can do and provide to cater to what the market desires. With our fast-paced lifestyles, demanding workloads and hectic social schedules, improving speed and efficiency can benefit you and your tenants. This can be done through using online portals, communicating via text messages and responding quickly, and having a strong WiFi connection at the property.
Keeping the tenant-landlord relationship on track
With the requirements of millennial renters expanding and the demands on landlords to meet them increasing, property letting can sometimes feel like a challenge. The relationship between landlord and tenant can become strained due to late rental payments, unforeseen repairs and miscommunications.
For landlords, it isn’t just about trying to impress potential renters — it’s about finding the right tenants for you. Running intelligent referencing checks before handing over a tenancy agreement will make sure that renters fit the bill and align with legal requirements. Running tenant checks to ensure the person(s) have the legal right to rent and taking advantage of tenant referencing services is an effective way to do this.
Once you’ve found the right tenants for your property, maintaining a good relationship will benefit both of you. Ensuring you meet all health and safety responsibilities, responding to queries quickly, being prompt with any repairs or maintenance requests and having suitable insurance cover are simple ways to keep your tenants happy.
Note that landlord insurance policies are different from standard home cover and can protect against potential risks associated with letting a property. Landlord insurance can cover everything from building and contents to emergency repairs, non-payment of the rent or malicious damage to the property.
Your tenants can also help maintain a good working relationship by running through an inventory check once they have the keys, informing you immediately of any required repairs or maintenance, looking after the property and respecting the rules set out in the tenancy agreement.