It has been suggested that with both the PRS and sales market appearing in greater equilibrium, 2014 could be a bumper year for the shrewd Sutton landlord who reacts to market demands.
Improved activity in the sales market has not hampered demand in the private rental sector which continues to outstrip supply in many areas, particularly London boroughs such as Sutton and Merton.
Affordability remains a big factor for many tenants and although rents have not risen in 2013 at rates previously experienced, they have still remained at a level that has driven tenants to consider what constitutes value for money. This has been met by a certain amount of inflexibility on the part of some landlords, be that toward a particular type of tenant, specific condition request or pricing adjustment.
Caroline Kavanagh comments:
“This year, we have seen a higher number of landlords prepared to wait to achieve their asking price, even if it has ended up costing them void time to a greater value, just to hold their price. Landlords should be planning for the future and working out a manageable way to keep their properties in peak condition so that they can justify commanding a certain level of rent. Tenants won’t pay over the odds, especially is the property doesn’t tick all the boxes.”
The sales market has seen some steady improvements throughout 2013, which is expected to gain further momentum in 2014 as the effects of the Government’s ‘Help to Buy’ scheme become more apparent. On the one hand, there is the likelihood that first time buyers will be up against the typical investor for flats and first purchase homes, which Caroline Kavanagh says could squeeze the lettings supply further at a time where stock levels need a boost. However, on the other hand, there is no shortage in quality applicants looking to rent a home, suggesting the long term renter is becoming a more permanent fixture in the UK’s buy-to-let culture, regardless of external factors.
“This bodes well for 2014, as we anticipate seeing more landlords taking advantage of better rates or alternatively releasing equity in order to fund future portfolio growth”
Property condition should be a big factor to those landlords seeking long term quality tenants. With rents remaining at a good level, those landlords who reinvest in maintaining their properties in 2014 will stand to make significant gains, benefitting not only from an active rental market, but a sales market that is likely to create capital appreciation” concludes Caroline.