2021 was a year characterised by unprecedented demand in the lettings market. Agents were inundated by tenant enquiries for rental property on a scale unseen for at least a decade. Whilst it was very frustrating for those looking to move, for landlords it meant that the time it took to find a tenant was reduced to a record-low of just two weeks (Source: Rightmove), the prices achieved exceeded their expectations and they had their pick of tenant profile meaning that down the line maintenance and repair costs are likely to be at a minimum. The race for space inside and out continues as working from home is here to stay; professionals are moving back to commutable locations for proximity to social hubs and to the office for at least part of the week, as life goes on with vaccinations for the most part keeping Covid at bay. Both of these drivers mean that we are confident that 2022 will see a continued high demand from prospective tenants and further price hikes of 4% in the next 12 months (Source: RICS).
As we learn to live with Covid in the background, a lot of moves are being taken off hold and for those relocating, bringing two households together or moving up the property ladder, holding onto your home enables you to benefit from the future capital growth of house price values, predicted at 5% in 2022, combined with the advantages of a buoyant market. We are also seeing investors return to the market with confidence, in fact a third of landlords surveyed stated that they were intending to buy an investment within the next 12 months (Source: Shawbrook Bank). Despite a mortgage rate rise, borrowing is still good value and property is still the investment of choice compared to other asset classes. (The average yield for Wokingham and Crowthorne was over 5% based on data from November).
It’s worth bearing in mind that ‘green’ property is higher up the agenda for both tenants in the light of increasing fuel costs and for landlords with further energy efficiency legislation coming into view. In this constantly evolving landscape of real life, finance and legislation impacting the market it is of the utmost importance to engage an expert agent to help you navigate your way through to a great result.
Liz Gamlen is Head of Lettings at Hat and Home and has 12 years' experience in the sector. A specialist in compliance, legislation and regulatory change, there isnt much Liz doesn't know about Lettings, so feel free to drop her a line if you have a question or need some advice.