With new legislation, increased mortgage payments and the section 21 debate you would expect many landlords to be running for the hills. Despite all this attention on the rental sector from the Government and the media, there are many reasons to either start or build on your property portfolio.
New research from a leading rental platform highlights that Britain’s rental stock has dropped from 225,000 homes in 2019 to a figure of around 134,000 properties today. That is a decline over the three years of 91,000, a staggering 40%.
This reduction in housing stock is representative across the country in differing degrees with rental properties down by as much as 57% in the North East and 16% in the East Midlands which has seen the smallest decline.
In our own region of the North West the research found a reduction in rental properties of 42%, which has been reflected in the number of new rentals coming onto the books at Poole Townsend. Demand for rental properties is still exceptionally high and we would expect this to increase as higher house prices and the pressure on mortgage rates brings more potential renters into the market.
This presents an opportunity for landlords to capitalise on this low-stock, high-demand environment.
Many buy to let mortgages removed from sale as brokers waited for the stock market to settle down are now making a return. Granted these are now at higher rates than previously but the rental yields available are higher too.
During the pandemic we discussed the opportunity for landlords to look to longer term solutions for their holiday lets. This may be an option for some as the cost of living crisis naturally adds its own pressures to the tourism industry. Switching from short term rentals such as Airbnb to longer term rents may provide a more stable income to support rises in personal costs for the private landlord with a smaller portfolio of properties.
The market is still vibrant, with property prices continuing to rise even at a smaller rate than over the last 5 years. Investment in residential property will still bring returns if you’re in it for the long term.
As lettings experts within an estate agency we can discuss the opportunities available to you if you’re in a position to buy property and add to your rental portfolio. Alternatively, if you’re looking for hassle free management of your existing properties, Andrew and Louise can support you to achieve the optimum rental income for your type of property.
Get in touch with the team to discuss your options.