After what has been the most unusual 18 months for the property market, we now have time to take a breath and look back (and forwards) at what has happened and where landlords and tenants stand currently.
The start of the pandemic caused the property market to very quickly grind to a halt with removal companies not allowed to operate, agents being unable to conduct viewings with potential tenants, or being able to take photographs and details of new properties to launch them to the market. There was huge confusion as key workers were still allowed to move, but not being allowed to meet an agent in person to hand keys over. Agents, and those operating in the property market, had to adapt extremely quickly and come up with new ways of working. Most of our teams were still operational but working from home, and remote working became the new normal.
Clarification from the government as things moved on allowed the property market to operate again, but this had led to a huge pent up demand from tenants as they needed to move for work or family reasons. The huge surge in demand and prices in the sales market meant a shortage of rental property. This has been the case since the start of the pandemic and is still the case today. There are significantly more tenants looking to rent than there is property available.
The Private Sector Rental Report from ARLA in July 2021 saw the highest average number of prospective tenants registered per rental office ever recorded. This is great news for landlords as rents have also been increasing, with a 5% annual increase across the UK (excluding London) and void periods at their lowest since 2016.*
In the North East specifically, rental growth is at a 10 year high, at 6.5%, and Newcastle has an average time to rent of less than two weeks.*
This is all positive news for landlords who have been hit with increasing legislation and costs over the last few years.
The sales market is showing signs of slowing, meaning that there is likely to be more supply of rental property coming to the market before long. This will be good news for tenants who have found themselves in competition with scores of other tenants looking at the same property as them. Landlords need to ensure they keep their properties in good condition to attract the best quality tenants and achieve the highest rents possible.
Legislation wise, landlords have had to comply with the Electrical Regulations brought in over the last two years, and moving forward, letting agents are going to have to be regulated and qualified in order to operate in the industry- a change that we think is hugely positive as an agent who is already a member of our regulatory body. Lettings is a complex and ever-shifting industry, with strict legal requirements, making it essential to use a professional and regulated agent to ensure you are fully compliant.
Now is a great time to look at expanding your portfolio as sales prices level out, rental prices remain high and tenant demand is strong. To discuss the market or your property/portfolio, please give our team a call on 0333 920 2220.
*Source- Zoopla UK Rental Market Report.