The ongoing political uncertainty in the UK has left many in a state of confusion and the affects of this are being felt by many different sectors - including the housing sector. Despite this, many regions across the UK continue to experience a growing demand for rental properties.
This is an ideal opportunity for property investors and those who have been thinking about entering into the buy-to-let market, as investing in one of the many UK locations where tenant demand is exceeding rental supply will mean there is the potential to receive strong rental yields and less likelihood of having to deal with dreaded void periods.
Some investors may typically look to turn properties quickly by buying, perhaps renovating to increase its value, and then selling. However, during times of uncertainty, and while tenant demand is so high, letting out properties might make far more sense financially.
Online property portal Rightmove claim a shortage in available rental properties has seen record growth in asking rents over the last few months, while the Royal Institute for Chartered Surveyors (RICS) believe that this trend is likely to continue. When it comes to property investment, most experts typically agree that its best to invest with a long-term strategy in mind as the property market works in cycles, and those who stick to long-term property investment plans are in prime position to benefit from both current excess tenant demand as well as capital growth in the future.
RICS recently released their latest residential market survey where they confirmed that the number of operating landlords is in decline while tenant demand remains strong. RICS say that contributors are expecting rental growth to increase by around 2% within the next year.
The recent changes that the government have made within the rental sector, such as introducing tax changes and the 3% stamp duty surcharge for investors, have predictably seen many landlords choose to sell up. The Royal Landlords Association (RLA) say that making it more difficult for landlords to successfully operate simply results in tenants suffering, and that this is exactly what is happening with a shortage of rental supply.
David Smith, policy director for the RLA, claims that anyone who believes a smaller private rented sector is good for tenants looking to eventually purchase a home are wrong. He says the new policies introduced by the government is choking off the supply of homes available to rent while tenant demand remains strong, inevitably making life more difficult and potentially more costly for anyone looking for somewhere to live. Smith predicts that without urgent changes and the introduction of pro-growth policies the situation will continue to become worse.
These comments came in response to a survey that revealed 31% of landlords plan to sell at least one property within the next 12 months, while 13% say they plan to buy at least one.
Remaining in the rental sector seems a sensible option at the moment according to many property experts, especially for those in certain hot spots where rental yields are particularly strong.
Are you a landlord in Cardiff looking to make the most of your investment? Or perhaps entering the buy-to-let market for the very first time? If so, contact our expert sales and lettings team here at CPS Homes and learn more about how we can help. Call today on 02920 668585, e-mail firstname.lastname@example.org or pop into one of our three Cardiff branches.