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Lancashire
Thursday, June 13, 2024

Residential Rental Rates Continue to Rise

With demand rising and stock shrinking at the year end, Paula Elliot, Head of Lettings for H&H Land & Estates and a qualified member of the Association of Residential Letting Agents (ARLA) offers encouragement for landlords to maintain healthy rental returns in 2023.

“A growing shortage of rental accommodation in the North West, mirrored throughout the country, has driven rents up by over 20% over the past year. In recent months, inflation has made it much more difficult for would-be house buyers to raise a mortgage. This has put further pressure on the rental market, and created more demand and opportunity for existing and potential landlords.

Demand is sky high for properties of every size, type and standard, but in the current economic climate the risks for landlords have increased, too, and we have widened our professional support of our lettings service to help landlords mitigate these risks.

The principal threat to landlords in times of economic uncertainty and rising costs is default in the payment of rent, which can be a serious problem for those depending on rent to either pay for the mortgage and or part of their own income. In recent months we have seen a significant rise in the number of landlords accepting our advice to take the very sensible precaution against loss of a Rent Guarantee Insurance.

Risks for landlords are also managed out by undertaking all the Right to Rent and Tenancy Compliance checks that establish a potential tenant’s credit and personal suitability. In October this year the Government reinstated the pre-pandemic rules on Right to Rent checks, and here again landlords – and especially new landlords should ensure this is carried out properly and professionally.

As a Member of ARLA and of Propertymark I am fortunate to have first-hand access to professional lettings legal advice, and my aim at all times is to support landlords in keeping them up to date with the latest legislation and on the right side of the law.

Moving into 2023, the rise in rental prices makes investment in rental property and or a move into letting your existing property even more attractive. The shortage of stock and the increase in people looking to rent means that well-vetted tenants who find the right property and a good landlord are staying put in long term rental agreements.

Demand is also creating a potential longer term rental market for properties bought as staycation homes in the lockdown years. With the continuing decline in the number of people taking staycation holidays, owners of these homes could consider securing good quality, high rent, longer term tenancies rather than leaving their properties empty particularly through the winter months.

Despite the stormclouds, the market for landlords in 2023 looks bright. A shortage of stock; a huge demand; and rising rents. For those who take the right precautions there is no risk of loss, and at H&H we are responding to the pressures of inflation by cutting our fees for a comprehensive management service that makes the process of letting as watertight and stress free as possible for landlords and their tenants.”

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