New rental market report captures latest state of UK market
- Surrenden Invest’s Rental Market Snapshot reports strong, sustained demand
- Regional cities remain at forefront of increase in private renting
- Brexit delay, section 21 ban and Labour’s PDR challenge having little impact on demand
A new report on the state of the UK rental market has revealed strong and sustained demand for privately rented homes, particularly in key regional cities. The 2019 Rental Market Snapshot, from specialist property investment agency Surrenden Invest, considers the key drivers behind the UK’s booming private rented sector and what this means for those who live and invest in it.
“What we’re seeing is a continuing drive towards rented accommodation in the UK, with developers racing to meet the demand for contemporary homes in city centres. Tenants are seeking ever more experiential homes, with concierge services and exciting roof terraces becoming something of a must. Investors, meanwhile, have largely shrugged off recent announcements, from the Brexit delay and potential Section 21 ban to Labour’s challenge to permitted development rules.”
Jonathan Stephens, MD, Surrenden Invest
Some 42,000 homes have been built in former office blocks under the altered permitted development rules (PDR) in recent years. Labour has proposed changing the rules once again (following the Conservatives initially changing them back in 2013) due to permitted developments not being required to provide affordable homes or to meet official space standards. However, any such change, unless replaced by an accompanying increase in housebuilding elsewhere, has the potential to place further pressure on the UK’s already tight supply of housing.
“Investors in the UK rental market are increasingly unphased by issues such as the potential Section 21 notice ban and the talk of PDR rule changes. We’re finding that those who were determined enough to see out the increase in stamp duty and the phasing out of mortgage interest relief are in it for the long-haul – which is good news for the UK rental market, given the continually increasing demand for privately rented homes.”
Jonathan Stephens, MD, Surrenden Invest
New homes such as No. 76 Holloway Head in Birmingham are doing much to fuel demand for inner city rental accommodation and the lifestyle that it provides. The spacious, elegant apartments are in an ultra-prime city centre location, with the Bullring, Grand Central and New Street Station less than two minutes away and the Mailbox even closer. For young professionals looking to get the best out of Birmingham, rental properties just don’t get much better.
Birmingham is, along with Manchester, Liverpool, Newcastle and the London commuter belt, one of the key markets highlighted by the 2019 Rental Market Snapshot. These regional hotspots are offering the lifestyle that renters want, combined with the yields and capital growth (or potential for capital growth over the coming years) that investors are seeking.
Right now, that capital growth is focused firmly on the North West. Newly published figures from HM Land Registry show that it is enjoying greater house price rises than any other English region, with monthly growth of 1.3% between January and February and an annual uplift of 4.0% in the year to February. The North West is also the area pegged by Savills as due to enjoy the greatest compound house price growth over the next five years, with a rise of 21.6% projected by 2023.
Again, developers are focusing on city centre homes that appeal to contemporary renters. Middlewood Plaza, for example, is just 10 minutes from Manchester city centre, and offers apartments, duplexes and townhouses with a stunning roof terrace for all residents to enjoy. It is the creation of homes like these that is boosting the appeal of rental properties to residents and investors alike.
For more information, visit www.surrendeninvest.com or call 0203 3726 499