The UK’s rental market is in high demand, with tenant numbers continuing to outpace properties available in many areas.
Buy-to-let landlords are finding no shortage of interested tenants across most of the country when they list their properties. For landlords this means fewer, shorter void periods and a good amount of competition, although it is a challenging market for tenants.
The rental market across Britain as a whole is seeing 17% of homes having lets agreed within two weeks of being listed, according to the latest figures released by Ocasa Homes. This is extremely quick, taking into account the time it takes to arrange and carry out viewings, and for an offer to be accepted.
In some areas, such as Bradford in West Yorkshire, this appetite is particularly heightened, with 30% of homes in the rental market being taken by tenants within two weeks of listing.
Hot property in UK rental market
Ocasa’s data looks at regions as well as cities in terms of how long it takes properties to go from listed to let agreed in the rental market.
Regionally, the east of England sees rental properties being snapped up the quickest, with almost a quarter (24%) of homes flying off the shelves within two weeks of listing. London also remains a fast market, with 20%.
The speed of the rental market in the south west (19%) and the south east (17%) is also ahead of the national average.
Looking at cities individually, Glasgow at 26%, London at 20% and Bristol at 17% all have rental market stock that is disappearing particularly quickly after being taken by tenants.
Ocasa also finds that rental values across England have experienced their highest annual growth rate since 2008, as rents have continued to be pushed upwards due to very strong appetite among tenants combined with a relative shortage of stock available.
Confidence in buy-to-let
Fortunately for tenants who are struggling in the challenging UK rental market, it seems that property investor and landlord confidence remains high, meaning many are planning to invest in more stock to rent out.
Research from bridging finance broker Finbri recently revealed that 50.45% of existing property investors are planning to invest more into housing in 2023.
Among the most seasoned property investors, even more activity is on the cards, with 68% of those with more than five property assets in their portfolios planning to capitalise on “increased opportunities in 2023”.
Finbri co-founder Stephen Clark said: “These findings demonstrate that those with a vast property portfolio are more likely to capitalise on the increasing availability of property as less experienced investors look to sell.”
As with any asset, there are risks involved, but these can be minimised by property investors opting for optimum locations and property types, as well as by adopting a long-term view of the market.
Rising interest rates are a concern at the moment, Clark points out. However, after a short, sharp spike in rates alongside lenders pulling products from the shelves in the wake of the mini-budget in September, things have already begun to recover – and rates are still at relatively historic lows.
Research the best locations
As part of Finbri’s research, it highlighted what it believed could be potential ‘hotspots’ for property investors over the coming months. These include Liverpool, Reading, Bolton, Slough, Aberdeen and Burton.
He added: “Property investment can be a great way to diversify your portfolio and generate additional income, but it’s important to do your research to discover which locations are better for investment.
“Keep an eye on interest rates, as they are expected to rise over the next few years and be aware of developments in the market that could make it more competitive.”