Property Patter: Rents Could Continue to Be Driven By Lack of Supply
Despite recent legislation and industry changes causing periods of unsettlement in the world of the landlord, it seems that there is still everything to play for.
For starters, as we recently covered, due to the colossal amounts first-time buyers are currently expected to stump up to get their foot on the ladder, many people simply can't afford to buy.
Secondly, a recent study from the Association of Residential Letting Agents (ARLA) has discovered that a shortage of properties continues to drive rental prices upwards across the UK.
Now, of course, while landlords like you facing growing pressure as a result of the implementation of the 3% stamp duty surcharge last year coupled with the phasing out of tax relief, it isn't unfeasible for you to raise your rents this year and beyond. In fact, according to the ARLA report, 20% of landlord respondents recently said they plan to increase rents.
So, does it still pay to be a landlord in 2017? Well, yes it does.
Now, the lettings landscape may have changing dramatically over the last couple of years, but the fact remains that there are many plus points to being a landlord in 2017.
Property is still without a doubt, the most lucrative investment option when stacked against other commodities including stocks and shares and gold.
Yields remain solid as rents continue to increase – rising by 3.9% across England in 2016, pushing the average rent price up to around £892 per month in December. Plus, average rents rose in 11 out of 12 UK regions last mont and Rightmove expects this trend to continue in 2017, with a further 4% increase forecast for zones outside of London.
Also, tenants, on the whole, are now in a much more stable financial position than they were this time last year. Fewer people are struggling to keep up with rental payments, which of course, is great news for all in the sector.
Speaking on the subject, property expert Michael Cook explained:
"Landlords need to understand how all these changes affect them, and seek advice to make the right decisions for their individual circumstances. This includes mortgage and tax advice from professionals and investment advice from local property experts.
We know that more people will be renting in years to come, and this is why so many landlords are saying they plan to expand their portfolios. They see the bigger picture – the long-term success of property investment.
All the projections for rental growth and capital appreciation over the next five to ten years make property a very attractive asset class.”
There may be concerns, and there may even be property owners jumping ship from the sector, but it certainly seems that those with vision and staying power will reap the long term benefits of being a landlord. It's a good time to be a landlord, and if you're looking to expand your portfolio, Stoke-on-Trent is an excellent option. In fact, it's a fast-growing property hotspot.