"This type of technology is making it easier for tenants to unlawfully sublet properties without the knowledge of landlords and letting agents."
Last month I touched upon how technology is both the present and the future of the mortgage market, and how intermediaries operating in the buy-to-let space should be open to learning more about its impact on them and their clients.
Another area I’ve spoken about in recent times is short-term lets and it’s interesting to chart the correlation between technology and this growing area of the buy-to-let marketplace.
Short-term lets are not just a result of the internet, they have been around for many years, but technology is opening the doors for more landlords to consider alternative revenue streams from existing or new properties, generate stronger yields and diversify their portfolios. Much of this is down to the popularity of short-term letting sites, notably Airbnb, and this is a trend which will only continue as more competitors emerge and competition heightens.
For every aspect of the marketing, booking and management processes involved in the short-term letting chain, established and emerging platforms offer a range of tools to meet landlord requirements in a fast, effective and convenient manner. With high volumes of traffic and business being driven to this marketplace, this will attract even greater levels of tech investment. Such investment will result in further digital innovation to provide landlords with a wider captive audience, greater support in regards to property management and more opportunities.
As previously touched upon, yield remains a major consideration for all types of landlords. Returns from holiday and short-term lets have risen over the past few years and it’s now no surprise to see well-maintained properties, in the right locations, producing yields of over 10% per annum. However, as we have seen with the rapid increase of cybercrime across all sectors, the tech revolution also comes with its fair share of challenges. One issue recently highlighted is that this type of technology is making it easier for tenants to unlawfully sublet properties without the knowledge of landlords and letting agents.
So how can landlords combat this issue?
The latest analysis from No Letting Go has revealed that regular property visits can help to protect letting agents and their landlords from the growing risk of subletting scams. According to the data, a professionally compiled inventory and commitment to the check-out process can also help to provide financial cover in the event of property damage.
One recent example, which featured on BBC One's Inside Out programme, saw a managing agent discover a family being checked into a rental property by the existing tenants. Further research uncovered a long-running subletting scam with over 70 reviews of the property left on Airbnb over the course of the tenancy. The tenants were eventually evicted but not before they had cost the landlord a significant amount of stress and money in repairing property damage.
For the vast majority of landlords this will not be an issue, but with technology evolving and subletting scams reported to be on the rise, it’s clear that all landlords need to be fully aware of such practices and be as vigilant as possible to help safeguard themselves from potential problems now and in the future.
Such issues should not detract from how positive an influence technology is and will continue to be. It is undoubtedly empowering more businesses, landlords and intermediaries to reduce their administrative burdens and is providing opportunities to tap into additional revenue streams. Here at Dynamo, for example, we’ve made huge strides this year by adopting new and innovative technology to provide a smoother and more streamlined application process for our clients. Correctly utilising technology’s power remains the key to success, whilst also understanding and combatting its potential flaws.