Guide
How does Guaranteed Rent work?
Guaranteed Rent is an agreement where a professional management company leases a property from a landlord for a fixed multi-year period and pays them a fixed monthly rent, regardless of whether the property is fully occupied or empty. It is the most hands-off way to earn income from a rental property.
The basic structure
The landlord grants the management company a lease on the property, typically for 3 to 10 years. The management company pays the landlord a fixed monthly rent for that entire term, then takes on all responsibility for finding tenants, collecting rent, managing maintenance, and handling any voids.
If the property sits empty for a month, the landlord still gets paid. If a tenant defaults, the landlord still gets paid. Guaranteed Rent transfers virtually all operational risk to the management company.
Who Guaranteed Rent suits
It is best suited to landlords who want fully predictable income, zero involvement in day-to-day management, and a long fixed term. Common profiles include remote landlords, portfolio landlords who have scaled beyond hands-on management, and landlords approaching retirement who want reliable income.
In exchange for the certainty, the guaranteed rent figure is typically set slightly below open market rent, because the manager is absorbing all void, arrears, tenant and maintenance risk.
How Northpoint runs Guaranteed Rent
We run Guaranteed Rent on qualifying HMO properties across the North West. Terms are 3 to 10 years, payment is monthly by standing order, and we typically include a complimentary refurbishment where the property needs bringing up to our standard.
You get one fixed payment per month, one point of contact, and zero admin. That is the entire product.
FAQs
- How long is a Guaranteed Rent agreement?
- Northpoint offers Guaranteed Rent agreements of 3 to 10 years, with the specific term agreed in advance.
- What happens if the property is empty?
- You still get paid your full monthly rent. Voids, arrears and tenant turnover are all handled by us and absorbed as our risk, not yours.
- Is Guaranteed Rent the same as a rent-to-rent scheme?
- Structurally similar, but Guaranteed Rent from an established management company is a properly documented commercial lease with a professional operator. This is very different from short-term rent-to-rent arrangements offered by unregulated operators.
- Do I still own the property?
- Yes. Ownership does not change. You grant a lease to the management company for the term of the agreement, and the property returns to you at the end.
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