7 tips to help reduce the costs of an empty property

In the UK, many landlords experience periods where their rental properties remain vacant. Tenant turnover, a slower rental market, seasonal market fluctuations, and renovations can all play a part in explaining why many properties remain empty.

To help mitigate and avoid these costs, read on for tips from Gallagher, the NRLA’s trusted Landlord Insurance partner.

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Recent research conducted by a London-based lettings and estate agent indicates that landlords across England have experienced a 19% increase in lost rental revenues due to void periods over the past year. In real estate, a ‘void period’ is defined as the interval during which a rental property remains unoccupied between tenants, leading to a loss of rental income.

If properties are left vacant, they may quickly result in costly risks. Empty properties can attract squatters, leading to illegal occupation of the building. Unattended fire or flooding can escalate and leave you with substantial damage in need of repairing or even rebuilding.

As empty properties are vulnerable to various risks, protecting them helps to preserve the building value and can also help landlords reduce costs on repairs and insurance premiums.

If a property remains vacant for a significant period, issues such as leaks, mould, pest infestations, and structural damage can go undetected, leading to increased repair costs for the landlord.

Opportunistic thieves are constantly on the lookout for unoccupied buildings and homes. This can result in problems like broken windows, stolen wiring and graffiti, which can prove very expensive for the landlord.

In the UK, squatting in residential properties is a criminal offence. Squatters can damage the property, and the landlord must bear these expenses. Moreover, evicting squatters could require court orders, making this an added financial and administrative burden for the landlord.

As cold and damp conditions are common in the UK, frozen pipes, storm damage, and blocked gutters are familiar issues that landlords have to deal with. If left unchecked, these can cause permanent building damage.

Unoccupied properties are often left without adequate ventilation or heating. This can result in dampness and mould issues, alongside pest infestations, and could lead to long-term structural damage.

In the UK, it is a landlord’s responsibility to ensure their property is safe, even when unoccupied. Neglected premises with hazards like unstable stairs, unkempt wiring or broken glass can lead to injuries, resulting in third-party liability claims.

Preventive maintenance can be paramount when it comes to securing a property. Here are some ways in which landlords can get started:

Routine checks can help to ensure property issues don’t cause long-term damage. If landlords can’t visit the property themselves, they could hire a local agent to check up on the house regularly.

Landlords can conduct property inspections using a checklist to ensure nothing is missed. Warning signs to look out for include water stains, open windows or doors, faulty security systems, broken locks, and so on.

Closed-up homes with stagnant air and no ventilation can quickly develop odours and condensation problems. Lack of ventilation in damp environments also gives rise to mould, which can lead to health issues. Landlords can prevent this by periodically opening windows or installing trickle vents.

During the winter, it is important to insulate exposed pipework and drain outdoor taps. Technology like leak detection systems or smart thermostats can also help provide frost protection during cold weather.

Landlords can greatly benefit from installing visible security measures, such as strong locks, burglar alarms, motion-sensitive lighting, CCTV cameras and smart security systems. These measures can considerably decrease the risk of break-ins.

Vacant homes with bins that are not secure, or where there are gaps in the building structure, can attract bugs and rodents. In instances where infestations are spotted, it’s essential to bring in a pest-control professional immediately.

Landlords can benefit from thorough documentation of all inspections, maintenance and repair work undertaken. Keep copies of receipts for maintenance services. Evidence of due diligence is important when filing insurance claims or when legal issues arise.

The longer a property sits unoccupied, the more costly it can be for the landlord. To reduce losses from a void period, a landlord may want to:

• Ensure regular maintenance of the property
• Use professional photos in listings
• Start advertising before the current tenancy ends
• List on multiple property websites
• Consider flexible lease terms during quieter months
• Revise the rent if the current price is acting as a deterrent

As summer approaches, many university students in the UK will be vacating their rentals. However, this period is a great opportunity for landlords to prepare for a new influx of student tenants. The late summer months are typically when students look to sign new tenancy agreements and move into accommodation, ready for the beginning of the academic year.

• Begin marketing your property early to attract future student tenants.
• Ensure furnished accommodation with study desks, fast Wi-Fi and communal spaces.
• Highlight the property's proximity to campuses, nearby transport options and other key facilities.
• Consider offering incentives, for example, a discount on the first month's rent.
• Offer a referral bonus for tenants who bring in new tenants before they vacate.

Many landlords do not realise that standard insurance in the UK often includes occupancy clauses that may limit cover if a property is left vacant for more than 30 or 60 days. After this period, insurers may restrict or withdraw cover unless certain conditions are met. To avoid coverage-related issues, it is ideal that landlords inform their insurer as soon as the property becomes vacant.

Practice proactive risk management — regular inspections and maintenance checks will demonstrate to the insurer that the landlord is actively mitigating risks and keeping the property secure even when it is vacant.

As a landlord, if you plan to undertake renovation projects during the vacancy period, speak to your insurer about modified options that help you stay protected without overpaying. If you’re reconsidering your cover, connect with insurance providers to get access to suitable landlord insurance that offers both financial security and legal protection.

With vast experience handling insurance policies for a wide range of landlords, and with relationships with some of the leading insurers, Gallagher aims to simplify your insurance arrangements and help to protect your property, its contents and your liabilities.

Alternatively, speak to the specialist Gallagher team on 0800 612 0094.

The sole purpose of this article is to provide information on the issues covered. This article is not intended to give legal advice, and, accordingly, it should not be relied upon. It should not be regarded as a comprehensive statement of the law and/or market practice in this area. We make no claims as to the completeness or accuracy of the information contained herein or in the links which were live at the date of publication. You should not act upon (or should refrain from acting upon) information in this publication without first seeking specific legal and/or specialist advice. Arthur J. Gallagher Insurance Brokers Limited and National Residential Landlords Association, an Introducer Appointed Representative of Arthur J. Gallagher Insurance Brokers Limited, accepts no liability for any inaccuracy, omission or mistake in this publication, nor will we be responsible for any loss which may be suffered as a result of any person relying on the information contained herein.

National Residential Landlords Association is an introducer appointed representative of Arthur J. Gallagher Insurance Brokers Limited, which is authorised and regulated by the Financial Conduct Authority. Registered Office: Spectrum Building, 55 Blythswood Street, Glasgow, G2 7AT. Registered in Scotland. Company Number: SC108909.