The rental market in the north west continues to see huge levels of demand from tenants, with landlords seeing properties snapped up quickly.
Across the UK, rents continue to climb, spurred on by a combination of factors including a shortage of rental homes versus tenant demand, an increase in the quality of rental options available, and landlords recouping the costs of increased mortgage expenditure and maintenance costs.
While homeownership is still an end goal for many, there are more rental options to choose from than there were a decade ago, such as build-to-rent, and a growing number of tenants opt to rent as a lifestyle choice due to the flexibility and lack of financial commitment compared with having a mortgage.
As such, the number of renters has grown across many parts of the country, including the north west, which has put pressure on rental stock and created a price surge. Added to this is the fact that rising house prices have forced many would-be first-time buyers to put plans to purchase on hold.
What’s happening in the north west?
The latest rental index released by Goodlord has revealed that six out of eight of England’s regions have seen rental costs increase for the another month. It means the average cost of a rental property is now £1,111 per month, up from £1,103 in April, the highest since September 2022.
In the north west, the average monthly cost of a rental property, according to Goodlord’s data, is now £887.73. The fact that it remains below the national average adds to the area’s appeal for tenants, as you get more space for your money in the region – a particular selling point in the post-Covid era.
This is up by around £10 a month, from £877.50, compared to the last rental index, which while a modest increase, shows that the trajectory in the north west is the same as elsewhere in the country.
What’s more, void periods in the north west stood out in the report as having had the most notable shift, alongside the East Midlands and the South West. The average void period – where a property sits empty between tenancies – is now 20 days in the region, down from 27 in January.
Commenting on the rental index, Oli Sherlock, director of insurance at Goodlord, said: “As we head into what are traditionally the busiest months of the lettings calendar, it remains to be seen as to whether we’ll hit the same rental cost highs recorded last summer.
“The data is pointing to the ongoing rise in prices continuing and, with voids also holding firm, the market is definitely primed to heat up as we head into June.”
Best place for buy-to-let
For property investors and landlords looking for the most promising investment location, an area where rental prices are holding steady or increasing, and void periods are below average indicating strong demand, can be a good place to start.
Of course, property prices and the chance of capital gains can also be part of the decision-making process, so an area that is tipped for future investment or regeneration, for example, could also prove a lucrative place to invest.
This is one of the reasons why the north west is one of the most popular investment destinations at the moment, as its house prices have outperformed the rest of the UK in recent years, and predictions indicate it will continue to lead the way over the coming years.
Manchester, the leading city in the north west, was named earlier this year as the best city for buy-to-let investment by Aldermore Bank. It scored particularly highly (a total of 73 out of 100) due to its long-term property price growth, with an annual average of 5.6%, and its strong tenant demand with nearly a third (31%) of residents being private tenants.
If you’re looking for your next investment property, BuyAssociation has a dedicated team in the north west that can help you find the best option for you. Browse some of our current investment opportunities, or get in touch today.