Key Highlights

In the property investment world, the idea of renting out your flat or house “off-market” has had increasing appeal in recent years. For the savvy and keen investor, it allows them to explore much more exclusive opportunities. But what does off-market mean and why has it become so popular?

What is an “Off-Market” Rental?

Off-market rentals are properties that are available to be rented by tenants but aren’t being publicly advertised. Generally, properties would be advertised on a range of platforms such as rental websites like Rightmove and Zoopla, online portals, or listing services.

Conversely, off-market rentals are often shared privately, usually through word-of-mouth, through real estate networks, or within exclusive circles. These properties can range from high-end luxury homes to more standard rental units, but the arrangement is always done with an air of exclusivity. 

This isn’t to say they’re below board or rented out illegally. These rental contracts still go through official channels, they were just never broadcast to the wider public.

How Do Off-Market Rentals Work?

Instead of being accessible to the general public, off-market rentals are usually shared within select groups. Real estate agents, property managers, or existing tenant referrals might know about these listings and pass the information to qualified renters.

Landlords may choose to keep their properties off-market for a variety of reasons, such as privacy. This becomes more acute when it comes to high profile or luxury rentals. In this instance, property owners may want to avoid public scrutiny or even inquiries from renters who could be considered “unqualified” to rent the property.

Other reasons usually tend to consist of wanting to cater to exclusive rentants. This is often the case with owners of more luxury properties who want to find a tenant from a much smaller and more trusted pool than sifting through loads of tenants who might not be suitable. In some cases, landlords already have a prospective tenant in mind through personal or professional networks, making a public listing unnecessary.

The Rise of Off-Market Rentals

Industry giant Savills recently revealed that they were seeing more and more renters and even investors approach them to market or rent properties off the market. What’s driving this trend boils down to a couple of factors. It is in part due to investors wanting to rent out a high-profile home without attracting too much attention – discretion and privacy are key in these instances. 

The Downsides of Off-Market Rentals

While there are some advantages, off-market rentals come with some potential drawbacks. One major challenge is simply finding off-market rentals for renters. Since these properties aren’t widely advertised, renters may need to rely on personal connections or well-established relationships with real estate agents to find opportunities.

There is also sometimes less transparency; as these properties aren’t publicly listed, there might not be as much information readily available about the property. Without the ability to easily compare properties, tenants might face challenges in determining whether they are getting a fair deal.

Lastly, since off-market rentals are not advertised to the public, they represent a small portion of the total rental market. This means prospective tenants have fewer options to consider compared to traditional listings. There is a reduced amount of tenants an investor can reach, meaning they run the risk of longer void periods or problems in attracting the right tenants. It is also harder to set competitive pricing.

Is an Off-Market Rental Right For Your Investment Strategy?

Off-market rentals can be an option for investors specifically looking for more privacy and the chance to find more exclusive tenants, especially if they’re in the luxury property market. However, by nature of not having it easily advertised it can be harder to actually get the word to the right people if you don’t have all the contacts. It is also not generally advised if you’re operating outside of the luxury home market.

If you’re someone who prefers to have multiple options to compare or wants the transparency that comes with public listings, the traditional rental market might be a better fit. At North Property Group, we offer an end-to-end lettings management service in addition to securing premium property developments for investors. We manage the property’s entire lifecycle — so you don’t have to. We have plenty of contacts, market know-how, and a platform to reach the tenants you want and need.

Summary

North Property Group is an esteemed property investment and lettings agency specialising in UK new build and off-plan properties in several key UK cities. We partner with world-renowned property development agencies to offer the best investment opportunities to investors across the likes of London, Manchester, Leeds, and more.

Our approach is client-focused and data-driven — don’t just take our word for it. With over 1,500 5* reviews on Trustpilot (and counting), we like to let the results speak for themselves. In addition to identifying the best deals on the market, we also can assist with comprehensive lettings management services, overseeing the entire tenancy lifecycle. Book a consultation with us today free of charge to begin your UK real estate investment journey.