The 5 steps to finding the right property management service in London

5 steps to find the best property management company in London - Hostmaker Blog

The number of landlords using a property management service in London is growing, and so is the number of such services. So how to pick the right one?

Well first, it’s a good idea to check the 5 reasons why you should be working with a property manager. You can see if it’s right for you and your properties. Second, not all property management services deliver the same service. You have:

  • traditional real estate agents (Foxton’s, Savills…) who often specialised in long lets but may do short lets on the side,
  • newcomers specialised in short lets (Airsorted, Passthekeys…),
  • and a few hybrid property management services who can do short, medium and long lets (like Hostmaker).

As a result, it is important to invest carefully in the company that’s right for you and your properties, without disrupting your rental income, and making you the most money.

The short let opportunity has been growing all over the UK, and in London especially. It presents landlords with opportunities: higher rates, more flexibility (as you aren’t tied up in long term contracts), better revenues overall. We’ve done a round up of the best rental strategies for 2019, and one of the main benefits of short let is making the most of the tourism flows: if they’re looking good, you could be leaving a lot of rental income on the table by long-letting.

This being said, early adopters have already been doing well, and the number of listings in the UK capital has quadrupled from 2015 to 2018 – reaching over 74,000 by October 2018.

This statistic gives us a clear insight into the attractiveness of the short let market, which is slowly winning over London landlords. Many started with one property, then another, then a third. And one of the best way to try is to do so with a specialised property management service, to truly assess the opportunity and see how it can protect your downside and maximise your upside.

At Hostmaker, our friendly team has compiled a list of the 5 fundamental steps London landlords should take to ensure that they find the property management service that’s right for them:

1. Locate the best and don’t settle

The number of property management services in London alone is growing all the time. As a consequence, it’s well worth landlords doing their research on how they can secure the highest quality service for their guests and tenants, whilst yielding the maximum financial returns for them.

We recommend asking the right questions to pick the right property management service in London: and don’t forget the bonus ones! Besides, don’t forget to really list the pros and cons of each: their services may look very similar, but when you scratch the surface they often differ quite a bit.

Among the most important differentiating points: the ability to welcome guest and tenants, the communication with them, the possibility to list your property on multiple platforms, and how sophisticated the pricing is.

2. Make sure they know the London market in and out

Once you’ve found the right property management company for you, it’s worth double-checking their local credentials. Local knowledge is more valuable than you think!

Ask them how big of a team they have on the ground, and how well they collectively know the city. Not only from a real estate standpoint, but also on the tourism side, as this is crucial for short lets. Indeed, the better you know what travellers visit your city, the more adapted your listing and your strategy.

Besides, you may want to check where else the company has offices, especially if you have several properties, or plan to invest internationally.

Hostmaker for instance makes the choice of always having its own teams in place, in every city, hiring locals to ensure the best property management. They are currently present in London, Cannes, Madrid, Rome, Bangkok, Paris, Barcelona, Lisbon and Florence, with a little over 500 specialists, from housekeepers to handymen to account managers and pricing experts.

Please fill out our form to register your interest in our ever expanding market and let us know where you’d like to see us pop up next!

3. Decide the services that you do and don’t require

There are a wide range of services available with property management services, from the most basic needs (linen, housekeeping…) to a more complete offering (listing, photography, pricing…).

Different landlords will have different properties, and different needs. A busy landlord with a few properties and a main job will probably want an end-to-end property management service, while another may have someone to take care of it.

When it comes to short lets, there are some specific questions you need to ask yourself:

  • how to market the property on the best platforms (Airbnb or Booking.com? HomeAway orTripadvisor? One or several?)
  • how to price properly for different times of the year?
  • how to create stand-out listings that will be preferred by travellers?
  • how to service the property effectively (welcome guests, give keys, cleaning, maintenance…)

Therefore, the first step is to define what you need:

  • if you have never rented properties on short lets before:
    • check a few property management companies to understand their scope, and see what the cost of doing it yourself would be: you will at least learn more about the opportunity, and get free estimates and valuations
    • if you have a few properties, why not compare both models, or even two different companies?
  • if you have rented properties on short lets, casually or more professionally:
    • check your current cost per stay, including the time spent managing the communications, the listing, the pricing. Compare it to the estimates you get from a few property management companies
    • check if you may want to use only hand-picked services, or if you prefer a full-service company: is your time best spent on housekeeping, or finding your next property?

Hostmaker offers an end-to-end service, tailored for landlords who prefer safe, predictable income with the upside of short lets earnings. Get an estimate from the online calculator!

4. Compare the prices and plans

There are various factors which set every individual property and landlord apart. Each home is unique after all. The same way, most property management services will have different prices depending on location, amenities, number of rooms, ease of access... etc.

Price will be a big factor in your choice, and most properties management companies offer free valuation and revenue estimates. We strongly advise to ask for a few quotes, and compare a few different offers.

Don’t forget to estimate overall revenues against overall fees (variable and fixed). Also, it’s a good idea to check both short and long lets operators to get a complete view. We’ve put together a quick table below for a quick comparison:

Services & figuresCompany 1Company 2
Short, medium and long lets?
Rental revenue estimate
Fixed fees
(listing, onboarding, tenant…)
Variable fees
(commission)
Ad hoc fees
(maintenance calls)
Total yearly fees
Total net rental income

For reference, Hostmaker can manage short, medium and long lets, for a management fee starting at 12% + VAT.

5. Confirm your top contenders

Once you have established the property management services you need and the plan best suited to your needs, the next step is to get in touch with your top 2 or 3 contenders.

At this stage, you may already be in contact after asking for a few estimates, so it’s time to really ask the big questions, like:

  • what sets you apart from X? What makes you better than Y?
  • why is your estimate lower/higher than X?
  • what are the specifics covered by your management fee? Are there any additional fees?
  • can you switch between short and long lets when need be?
  • how much flexibility do I have with my property’s availability?

Better to ask the questions from the get go rather than be surprised later!

Best of luck with your search, and do feel free to get in touch with our team via our online service if we can help you with any questions. Or just send us a note at london@hostmaker.com or +44 2035530428, we love a good chat about properties!

London property management services fees: explained

Discussing the details of a London property management service contract

For even for the most experienced homeowners, investing in the services of an expert Airbnb property management service – or short let management service – is a guaranteed way to protect your downside, maximise returns and assure a memorable, 5-star experience for your occupants.

Keep reading to understand more about property management pricing plans, what’s included in the service, and also have some of the most frequently answered questions regarding fees explained in detail.

What’s included in a property management service?

An Airbnb property management service like Hostmaker can assist you in fully unlocking the potential of your property in a variety of ways. Typically most companies in the market would offer:

  1. Listing your home in one or more channels, often the likes of Airbnb, HomeAway, Booking.com, Expedia… etc.,
  2. Pricing your home for different days and periods,
  3. Managing incoming reservations and communicating with each guest
  4. Giving the keys and welcoming each guest (some companies use lock-boxes, others, like Hostmaker, prefer to always have a real person to welcome every traveller),
  5. Exchanging with the guests during their stay,
  6. Housekeeping and cleaning service after the stay.

What questions should you ask when comparing property management companies?

Parisian balcony life from one of the apartments managed by Hostmaker in Paris

The difference between each Airbnb property management company resides in how they do each step, and what extra steps they may provide.

For instance, a property management service like Hostmaker would list your home in over 15 different channels, 2 of which exclusive to them. Their housekeepers all have prior experience as housekeepers in hotels, and are provided special training inspired by their partnership with Marriott International.

It’s always worth asking more detailed questions as you are considering which property management company may be right for you, and why some are cheaper than others. To take the list from before, it’s worth asking some of these questions:

  1. Listing your home in one or more channels: what channels? Are there any exclusive ones? What are the benefits of the ones the company offers?
  2. Pricing your home for different days and periods: how often is the price updated? Does the property management company update it according to local events? What about local hotel prices?
  3. Managing incoming reservations and communicating with each guest: how would they typically manage this? Is there any risk of a message being lost?
  4. Giving the keys and welcoming each guest: is this done with a lockbox, or thanks to a human interaction? How is the information about your property communicated to the guest? How often is your home checked by the property management company? Is check-in available 24/7?
  5. Exchanging with the guests during their stay: is this available round the clock? How does the property management company ensure that they always have the right information, without having to contact you each time?
  6. Housekeeping and cleaning service after the stay: how are the housekeepers trained? How specific can your instructions be with them? Can they take care of your plants (yes, all very important questions!)?

Any other questions I should consider? Bonus questions!

It’s also useful to ask yourself what additional services might be offered, for both your and your guests. Typically:

  • Is the listing prepared by a professional photographer and a professional copywriter, to ensure maximum exposure?
  • Is there a performance dashboard available where I can see my earnings at a glance?
  • Can I open and close my property’s availability through an app or a tool?
  • Can they help with interior design work, should I need to refurbish the property prior to letting it? What are the packages offered?
  • Do they offer maintenance and technical support, 24/7, in that most annoying of cases when the boiler fails or the water leaks?

What’s the standard Airbnb property management fee (or short let management fee)?

Calculating fees for a London property management company
Calculating fees for a London property management company (the old-school calculator way)

In terms of fees, there are a variety of pricing plans around. For instance, Hostmaker offers a Fixed and a Flex plan, for property owners who want a stable income, and those who prefer to maximise their earnings. Other companies may have various options too.

The factors impacting a property management fee

As a rule of thumb, the management fee will depend on:

  • the level of service you would like to ensure (the more premium, the higher the fee, but the more complete the service)
  • the location and size of your property
  • the availability of your property (few weeks in a year, few months, or full time: the longer, the better as the service will have time to optimise the strategy to ensure the best returns)
  • the amenities of your property (balconies, spa-like bathrooms, sofa-beds can all be fetching higher prices, which may impact the fee)

The management fee is usually calculated on revenues driven to the property after the commission perceived by the listing platform (Airbnb, Booking.com, HomeAway…). Do ask the question if you aren’t sure!

Research suggests that 15% is the standard rate you can expect to pay for Airbnb property management services on average – which drops down to about 12-13% for basic services and can often go as high as 20% for premium services.

An example of property management fees: the Hostmaker Flex case

At Hostmaker, the most popular offer is Hostmaker Flex, which offers property owners an end-to-end, full-featured management service, starting at 12% + VAT. This means that the management fee will be 12% + VAT of the revenue you will have received from stays in a given month, minus any platform fees and call-outs.

The management fee can vary depending on the factors above, but you can ask for a projection of what your property would typically achieve, as a benchmark. Across London, clients using Hostmaker Flex achieve on average 30% more than long-term lettings.

Have any queries? Let us know about your property and our friendly team can help with any questions you might have.

Which pricing plan is best for me?

It really depends on your portfolio and your situation. For instance, if you’ve got the right property and a need for a more stable income, a fixed option can be an excellent solution. Of course, you may be leaving money on the table, but you are assured of a rental income, without the risk of a void period between tenants.

On the other side, a fee-based solution like Hostmaker Flex means that you only pay when results come in, so the risks are very limited anyway, and the upside can be important.

Finally, if you manage multiple properties, a more professional solution can mix both pricing plan according to your risk appetite and earnings objectives. For instance, if you own a block of flats, you may want to have a few on long lets, a few on mid lets and a few of short lets, to spread the benefits of all types of lets.

A quick comparison of the pricing options at Hostmaker
A quick comparison of the pricing options at Hostmaker

Ready to unlock the true financial potential of your property(s)? We’d love to hear from you! Tell us about your property here and we’ll be in contact with all the information you need.

Best rental strategies for 2019: should property owners go short?

A Lisbon home designed by At Home with Hostmaker, the interior design studio of Hostmaker

As 2018 comes to an end, and with the uncertainty of Brexit looming, property owners in London are left scratching their heads as to what the best rental strategy is.

Is it a great time to buy new property, as prices seem to be going flat or down in some areas of the British capital? Is it better to go for long-term tenants as a stable income stream?

What about short-term lets – are they a good option in the current climate? These answers, and more, below. Or scroll down for the conclusion!

Rental strategies in 2019: long lets vs short lets

Hostmaker home with a living room giving on a balcony in Paris
Home with balcony in Paris – courtesy of Hostmaker

We’ve talked about the main differences between long and short-term lets before, to highlights their pros and cons for property owners. But there is more to it, if we want to go into the details. Here, we’ll review some of the main reasons to pick one or the other.

The main differences between short, mid and long term rentals or lets

Here’s a quick refresh of the main differents, and adding the further distinction of mid-term lets:

  • long-term lets (long lets): the traditional letting arrangement, with contracts from 6 months to 2 years,
  • mid-term lets (mid lets): a growing segments of lettings, from 1 month to 6 months, typically for professionals or students,
  • short-term lets (short lets): the fastest growing segment, from 1 day to 30 days, which originated in vacation rentals and is popularised by platforms such as Airbnb, HomeAway, TripAdvisor or Booking.com and traditionally earn property owners the most.

Each strategy has its benefits and risks, and adopting one or the other depends on:

  • the economic environment – short lets are best when tourism is doing well for instance,
  • the property – its location, type and availability,
  • flexibility requirements – do you prefer to be able to get the property back easily should you need to, or to organise viewings easily?
  • bandwidth – and how much time you want to spend doing things yourselves or through agencies,
  • revenue expectations and risk profile – how much money would you like to get out of the property, and how risky would you like it to be?

Comparison table with pros and cons for short lets, mid lets, and long lets

As a rule of thumb, here is how short, mid and long lets compare:

Flexible lettings explained: comparison of short, medium and long term lets
Flexible lettings explained: comparison of short, medium and long term lets

How to pick the best rental strategy for your property or properties in 2019

Now that the benefits and risks of each type of letting is clear, we can look at 2019 together, and determine what is your best. To do that, we’ll first evaluate the property market in London for next year, and then look at the tourism forecasts for the capital. As we saw in the comparison table, this will help you decide between short and long lets.

Rental strategies in 2019: the property market, tourism forecast, and overall environment

The property market in London in 2019: looming Brexit and other factors

Long-term rents likely to go down in 2019, with slight rebound in 2019, making long lets less attractive

ONS: average asking price for houses in London and the UK up to March 2018
ONS: average asking price for houses in London and the UK up to March 2018

There is no avoiding it: the specter of Brexit looms. And with it, the uncertainty has taken a hold of many buyers and sellers. Whether the U.K. leaves the E.U. with a deal or without, the 29 March 2019 cut-off date is months away and all bets are still off.

This has taken a toll on the property market: London houses prices overall are showing worrying signs of stagnation or even decrease in some areas. The general mood is best described as “wait and see”, as the November 2018 numbers show: listings for homes being sold on Rightmove in London declined by 24%.

This climate will also impact the attractiveness of London for new and existing residents. While it is unlikely to drive drops in rental incomes right away, there will be an effect for homeowners. The type of Brexit chosen has already limited foreign investments in the country, as well as delayed expansion plans for existing businesses. Most forecasts point at a modest growth overall in 2019 and 2020, up to 2.1%.

Statista - London rental prices from 2018 to 2022 growth forecast 2018-2022 UK Statistic
Statista – London rental prices from 2018 to 2022 growth forecast 2018-2022 UK Statistic

Finally, the Bank of England’s main interest rate has steadily increased in 2018, to now reach 0.75%. It’s making variables mortgages more expensive for 3.5 million U.K. homeowners, and is likely to rise again in December 2018 to fight off inflation. The pressure for homeowners to increase rental income will grow, and it is unsure whether it can be met in London with long term rentals alone.

Travel in the UK in 2019: even better than a record 2018?

Travel forecast strong for 2019 and 2020: the demand for short lets will increase

UK braced for record number of tourists in 2018 and 2019 - The Guardian
UK braced for record number of tourists in 2018 and 2019 – The Guardian via VisitBritain

On the other end, 2018 is already set to be the best year on record for tourism in the UK. VisitBritain forecasts 40.9 million visitors from overseas, spending a total of £26.3bn, up from 39.2 million and £24.5bn in 2017.

2019 could be even better, as many factors converge to give a boost to London in particular:

  • a weaker pound will make the U.K. more attractive to overseas tourists, increasing their spending power,
  • London, with 19.83m visitors in 2018 (up 3% on 2017), is #2 of Top Global Destinations charts
  • a strong economic growth forecast globally, especially in Europe and the U.S., will increase travel flows overall,
  • the share of disposable income spent on experiences, such as travel, continues to grow (especially with millenials now accounting for over 25% of the population in OECD countries),
  • London can easily take advantage of top 2019 travel trends such as a bigger focus on sustainability, and meaningful local activities.

This will fuel a strong demand for homestays in London in 2019, and ensure a good occupancy at a fair rate.

Conclusion: the best rental strategy in London in 2019 is… short, with a bit of mid

Short lets best bets to take advantage of growing tourism flows, especially with Brexit uncertainty looming

When all is said and done, the best strategy for 2019 is likely to be a mix of short and medium lets. As we’ve seen, the tourism forecast for London is very positive, guaranteeing a strong demand for short lets in 2019. On the other side, the growing demand for medium lets make them an attractive alternative from September to May. The risks are minimal – as the demand is strong – and the upside is big.

While the outlook for long term rentals isn’t completely negative, it is looking flat at best (after inflation). Thus, introducing short or medium lets to your mix makes sense. If the operational side is your main issue, there are a number of short let management services you can try. This commission-based model helps because you only pay them if they deliver revenue for you. And they will take care of the operations of listing, pricing, welcoming and cleaning – and often more.

In fact, specialised property management services, such as Hostmaker, can even manage your home on short, medium AND long term rentals. Their local experts will help you to pick the best option depending on your property, your profile and your goal.

Flexible lettings model mixing short lets, mid lets and long lets
Flexible lettings model mixing short lets, mid lets and long lets

How to be a Hands-off Airbnb Host

Hands-off Airbnb Host

Running a successful Airbnb rental can highly stressful – there’s simply not enough time in the day to deal with current guests checking in, ongoing cleaning and maintenance, booking management and communication with future guests. You might often wonder how the most successful hosts with a portfolio of profitable properties manage it all. The answer is hands-off hosting.

Being a hands-off host doesn’t mean you relinquish control of your Airbnb or you no longer have any creative input – it simply means you have the time to reap the rewards of your rental. Not only can a property management company give you back some precious time, they can also improve efficiency which in turn can boost yields.

Who can become a hands-off Airbnb host?

Hands-off hosting isn’t just designed for property owners who are away a lot or have investment rental properties in numerous locations; any host can take the hands-off approach. By finding the right Airbnb management company, you can let the professionals do the hard work on your behalf, keeping guests ‘five star’ happy.

You may only need help with a certain part of your rental business, such as the initial interior design of the property or a regular cleaning and maintenance team to take care of the daily property management. However, you may also decide to take on a full management service and become a completely hands free host, allowing you to focus on other projects or freeing up your time for personal reasons.

You can become a hands-off host whether you use Airbnb to rent out your home, your second home, or if you are a portfolio investor. By utilising professional services you’ll be able to secure better reviews, increase your income and enjoy more free time for yourself.

Hostmaker – the ultimate hands-free hosting service

At Hostmaker we’re more than just a property management company; we always go one step further to ensure we’re helping our hosts achieve superior yields and become successful as a landlord or Airbnb host. You can pick and choose our local services or alternatively, we’ll hold your hand and guide you through the hosting process from day one – before you’ve even listed your property.

Of course we deal with daily operations and booking management (from housekeeping to personal check-ins) but where we really stand out is our high-tech tools and software to improve efficiency. We’ll run a daily pricing review which guarantees you’re getting the best nightly rate for your rental, as well as vetting guests and making your listing stand out from the rest. Hostmaker can even help you get the right short let insurance you need to protect your property, so you can be completely hands-off with peace of mind.

Find out more about hands-off hosting with Hostmaker by telling us about your property or portfolio.