Five Reasons Why Your Rental Property Might Be Lying Vacant
Even as a large number of people continue to rush towards India’s mega cities every year to join the existing workforce there, many perfect-to-rent homes continue to lie vacant. According to private estimates, urban centres in India are together sitting on a vacant rental stock of over 11.09 million units.
“Weak tenancy laws are cited as the prime reason why investors fail to generate any income on their rental properties and rightly so. In the name of tenancy law, the government recently came up with the Model Tenancy Act, 2019, the provisions of which are primarily ‘model’ in nature and the law has no binding effect on states, which have the final say in the matter,” explains Brajesh Mishra, a Gurgaon-based lawyer, specialising in property law.
While government policies and low rental yields could partly be blamed for such vacancies, the property holder’s individual choices also play a role in their prized asset not attracting enough tenants.
Are you asking for rent higher than your neighbours?
If you are looking to monetise an asset, expectations should be in line with the property’s real potential. No matter how wonderful your property is, it won’t generate a higher income than what similar rental properties in the area garner. Be mindful of that fact while setting the asking price.
Are you letting people know your property is available for rent?
While overestimating you rental property is a flaw, be aware that the property won’t find itself a tenant simply by being there. You have to let people know about it. For that, consider taking assistance of a property broker or register the house on online sites that help you market it, often free of charges.
Are you setting too many conditions?
This is another reason why your rental property stays vacant despite its worthiness. Even if they happen to be temporary owners, tenants would like to enjoy the privileges and freedom a home offers. They cannot be expected to follow the typical hostel-like rules, the greatness of the property notwithstanding. They won’t do it more so because so many other property owners are quite willing to offer them the freedom they are looking for.
Are you being too picky?
There are instances of landlords refusing to let out their property to people, based on food and life choices, besides religion. While such practices are illegal, they would also substantially reduce your options. If generating rental income is the target, you should consider broadening your perspective first.
Are you taking enough care of the property?
This is a common complaint among renters in India. Once the landlord is able to find a tenant for the property, they forget all about its maintenance and the on-time rent payment remains their only concern. This discourages the tenant and they often move out at the very first opportunity.
Sometimes, it is the other way around, where the previous tenants left your brand new property in tatters and you don’t have the budget to make corrections. Be advised that you will have to discharge that responsibility sooner or later. You can start saving for that purpose. You can remind yourself of the one golden rule of any business — only money earns money.