The Property Teacher - One Thing You Must Do When Your Rental Property Is Empty

Unfortunately, voids, or vacant periods when your rental property is empty, are a fact of life.

Here’s one thing you absolutely must think about whenever you have a void.

When you’re new to property, you’ll probably assume your rental will never sit empty. Maybe you’ll think, “If it does, I’ll just re-let it and get a new tenant in straight away.”

I used to think the same, and sometimes that can happen. I’ve had new tenants moving in almost as the old tenant is moving out.

But here’s the reality: properties do go empty, and it’s often not as straightforward as just finding a new tenant the next day. It doesn’t happen very often that a tenant moves in on the day another tenant moves out.

Sometimes the outgoing tenant is great and leaves the place spotless, and you’re good to go.

But let’s be honest — sometimes they’re scruffier than their references made out.

Or they’ve been in there for a good few years, which in one sense is great, but now the place is tired-looking and needs some TLC.

The walls are a little grubby, the carpet’s worn, or maybe you’ve got a bit of minor damage or wear and tear. Suddenly, you’re not just handing over keys to the next tenant. First you need to get the property back into lettable condition.

And if you’re unlucky, it’s more than just a quick tidy-up.

We’re talking new carpets, full redecoration, maybe even sorting leaks or boiler issues. The kind of stuff you can’t do yourself over a weekend.

This is likely to be the case the longer the tenant has been in the property. I’ve had tenants in a property for 10, even 15 years. That was great for cash flow, but it almost guaranteed that at the end of the tenancy I’d need to do a fairly substantial renovation.

And this is when things start to move more slowly than we’d like.

It’s highly unlikely that your contractors and tradesmen will be available straight away. Everyone’s busy and, if you need to get a few quotes first before you do the work — and you probably should if you want to keep costs down — things can drag.

Until the property is freshened up, it will be sitting empty.

Sometimes for days, if you are lucky, but more likely for weeks. After all, your contractors and tradespeople might not be able to get out to give you a quote for a couple of weeks, let alone think about starting work.

So it’s not unknown for a property to be vacant for a month or more between tenants.

It’s unfortunate, but it can happen.

It can be frustrating because during this period you won’t be receiving rent, but you probably still have a mortgage to pay, plus council tax and utility bills. And at the end of it you’ll be receiving a bill for the renovation and the cleaning.

But here’s the bit you don’t hear people talking about very much: empty properties are vulnerable.

So the first thing you need to do is make sure your insurance company will cooperate if anything happens.

If the property is vacant over winter, that could mean shutting off the water supply at the stopcock and draining down the water and heating.

And regardless of the time of year, you need to make sure that windows and doors are locked and secure, and that the property is inspected on a regular basis either by you or your managing agent, with a diary note kept of when you were at the property.

You can be sure that if anything happens, the insurance company will want proof — by which I mean the diary entries — that the property hasn’t just been forgotten.

You need to check the small print.

Most insurers expect regular inspections, sometimes every 7 or 14 days, or they can wriggle out of paying. So if you’re assuming you’re covered while it’s empty, make sure you’re actually doing what your policy says you should do. If you’re not sure, your insurance broker should be able to advise you.

So what can happen when the property is empty?

It could be something as simple as a leak, as I’ve already alluded to, and if that happens, you don’t want it bringing down ceilings or ruining carpets. Or there could be storm damage in extreme weather.

But sadly, the property could also be a victim of crime.

I’ve had boilers and pipework stolen during voids. I’ve had people chuck rubbish over the fence into the yard, like it’s their own personal tip. Not just one bag either, but proper fly-tipping. I’ve had lead flashings taken from roofs.

Void periods aren’t just about lost rent.

They can cause cost, hassle and risk.

So do plan ahead. It’s really a case of hope for the best but plan for the worst.

Make sure you have a system in place for inspections and, if you are leaving it to your managing agent, make sure they are doing them at the right times and recording when they visit.

In the meantime, as soon as you know a tenant is leaving, make sure you, or your agent, line up reliable trades to provide quotes and timescales as early as possible.

This is one of those subjects where we need to be realistic.

Voids do happen, and they don’t always fix themselves overnight.

But this doesn’t need to be doom and gloom. It’s just the stuff no one tells you about when you’re starting out.

So expect voids, and be prepared.

The more prepared you are, the fewer nasty surprises you’ll face.

This isn’t advice, of course. Just a practical reminder that when a property is empty, the risks change — and ignoring the small print can be expensive.

Here’s to successful property investing.

Peter Jones
Author, property investor and ex-Chartered Surveyor

PS. By the way, if you’d like a deeper dive into property investing based on the real-life experience of an investor who has built a substantial multi-property portfolio, my popular e-book, The Successful Property Investor’s Strategy Workshop, explains how I built my own portfolio from scratch and the principles that can help you do the same.