In newly release figures from popular property website Zoopla, annual rental growth reached the highest level for 13 years at 4.6% in the third quarter. The average cost of renting a home in the UK, excluding London, now stands at £809 per month, 6% more than a year earlier!
Nicky Burridge, contributing editor at Zoopla has said that it seems that demand for rental homes is 43% above the five-year average, but the number of properties available to rent is 43% lower than usual meaning that the cost of renting a home has naturally increased. Nicky is quick to point out that these figures for renters aren’t all doom and gloom: “The good news is that despite the increase in rents, affordability has remained largely unchanged thanks to rising pay, with rents accounting for an average of 37% of a single tenant’s monthly income.”
So, we know what this means for tenants but what does this mean for landlords or potential future landlords? Simply put it means that if you’re a landlord with a property to rent or are exploring your options with purchasing a property to let, the combination of rising rental property demand and higher rents is good news for you.
Nicky goes on to say that “The current buoyancy of the rental market may mean it’s a good time to think about extending your property portfolio. But bear in mind that demand patterns have changed compared with during the height of the pandemic, with renters returning to city centre locations. Overall, rents across the UK, excluding London, are likely to end 2022 4.5% higher than they started it, while rents in London are likely to rise by 3.5% to exceed their pre-pandemic levels.”
Our take on this is that although rent is increasing, this is only because of the shortage in rental properties being on the market. The solution? If you own a property, you are considering renting out or are potentially looking at purchasing an investment property, speak to us now to see what your options may be. An influx in buy to let properties hitting the market is just what the housing market needs and in turn this will bring the renters back to a more sustainable level and a more consistent income for property owners.
If you want to explore your options either as a landlord or even as a renter, please give our friendly mortgage experts at Oportfolio a call on 020 8877 1169.