We believe that the private rental sector is likely to remain a popular choice for 2013, with demand for rental property unlikely to slow. Despite the double dip recession of 2012 and more positive glimmers recently, there is still a general feeling of uncertainly within the market. Thus, from a rental view, we have found that tenants are staying longer and putting off buying a home. We find on average that tenants stay for 19 months.
Buying a home is not as easy for many tenants as it was for their parents, with a shortage of mortgages within the market and the combination of higher deposits that is now required. Historically younger people were very keen to get onto the property ladder, but we have seen a shift away from this, with renting a property being seen as a more viable option.
Our tenants are now, not just young professionals under 30, more families are selling their family home and moving into rented accommodation. Their reasons for this, range from relocating to the area, moving into somewhere whilst they are renovating a property or selling their own home and seeing what the market will do and therefore, giving themselves greater flexibility when looking to buy a new home.
We are continuing to find that buy to let investors are looking to increase their portfolio and even first time investors are still in the market, as long term growth being better than alternative investment opportunities.
Being a tenant has great advantages, which some of our tenants truly value, but very often once they are leaving a buying their first home. These include, having a maintenance department on hand to fix leaky tapes, boilers that aren’t working or even redecoration. Being a tenant offers flexibility, particularly in the changing economic climate, moving at a month’s notice for a new job opportunity is much easier than the hassle of selling a property.
Over the next 12 months, we expect that tenant demand will increase, particularly for one and two bedroom properties within the areas that we cover and more first time landlords will be borne, particularly ‘accidental’ landlords, ie, those that have to move due to work commitments. Rentals will continue to rise along with demand.
2013 – unlucky for some? It seems not