Member Article

£111 Million of Short Term Rental Potential Wasted in London Annually

The private rental sector is growing on a daily basis, but not fast enough to prevent 8,801 dwellings in the most sought-after areas of London from remaining empty. GuestReady has calculated that the potential revenue that could be generated, were long-term empty properties in zones one and two of the capital made available for short-term rental via Airbnb, is in excess of £111 million – £111,086,222, to be precise.

The award-winning independent accommodation management company calculated the potential revenue based upon an 85% occupancy at a whole house rate of £165 per night. Complying with the Airbnb policy that homes in Greater London cannot be listed for more that 90 nights per calendar year, each property has the potential to generate £12,622.50 per annum – not bad for a theoretically passive income.

According to the research, empty home owners in the borough of Kensington and Chelsea have the most to gain from considering the short-term rental market, with 1,230 properties currently without long-term residents. If each of these properties were rented out at the above rate, more than £15m could be generated. Camden and Southwark are not far behind, with 1,142, and 1,128 empty homes, respectively. Property dwellers in both boroughs could raise in excess of £14m through opening their dwellings to the short-term rental market.

The areas with the smallest number of empty dwellings are:

• Wandsworth: 132 empty properties, capable of generating £1,666,104
• City of London: 158 empty properties, capable of generating £1,994,276
• Westminster: 292 empty properties, capable of generating £3,685,624
• Hammersmith & Fulham: 329 empty properties, capable of generating £4,152,638

No other borough within zones one and two had fewer than 500 empty properties.

GuestReady co-founder and CEO, Alexander Limpert, comments: “Leaving a property empty in such highly desirable areas as London’s zones one and two is such an enormous waste of potential.

“Many people let their properties remain empty and avoid long term letting so they have the option of using them even just a few times a year as vacation homes or other but with short-term lettings people still have the optionality to stay in the properties when they want, letting it out around dates that suit them.

“The other reason people are deterred from opening their unused properties for short-term rental is the misapprehension that it’s a labour-intensive exercise. By employing a management team, however, all the hard work is taken off your hands, leaving your property to deliver you a steady – and substantial – return, passively.

“London continues to be among the world’s greatest tourist and business draws. There are potential customers waiting for every one of those 8,801 empty houses. And a lot of wasted money waiting to be made.”

This was posted in Bdaily's Members' News section by Sue Anderson .