Short-term rental properties in tourist destinations and city-break locations continue to generate higher returns than traditional long-term lettings, according to property investment adviser Ginny Warby.
Speaking about current opportunities in the rental market, Warby noted that Airbnb and holiday lets remain in strong demand in areas with consistent weekend traffic, though landlords need to account for additional costs and property presentation standards to maintain profitability.
Investor behaviour shifts
Investor behaviour has evolved over the past 12 months, with landlords increasingly focused on portfolio diversification and income generation rather than capital growth alone. Higher operating costs and reduced profit margins have prompted many to explore alternative rental strategies.
“I’ve also noticed more investors taking a longer-term view by holding onto assets for longer and putting more emphasis on steady cash flow,” Warby said.
She expects yield prioritisation and property futureproofing to remain dominant trends throughout 2025.
Professionalisation of the sector
The rental sector’s shift towards professionalisation is raising standards across the industry, according to Warby. She advised smaller investors to remain competitive by being selective about property acquisitions, focusing on areas with consistent tenant demand and adopting long-term investment strategies.
When asked where landlords should direct their attention, Warby emphasised the importance of demand and affordability over specific property types or tenant demographics. She recommended focusing on locations where rental demand is genuine and rent levels align with local market conditions.
Due diligence essential
Warby’s advice to landlords looking to expand their portfolios centres on thorough due diligence and long-term planning. She cautioned against purchasing properties based solely on budget constraints, stressing the need to verify strong rental demand and appropriate rent levels for the local market before acquisition.
The comments come as landlords navigate an evolving regulatory environment and higher operational costs, with many reassessing their investment strategies to maintain returns in a more challenging market.
