UK rental demand is set to increase

UK rental demand is set to increase

Many people, following the pandemic, have re-evaluated their priorities. Whether that’s meant that they’ve changed jobs, picked up new hobbies or interests, or simply taken a little extra time for themselves, it appears that prioritising a more equal work/life balance has been pushed to the top of the list.

In terms of property itself, we’ve seen changing priorities for homeowners and renters. Some have decided now is the time to take the opportunity to move into the city for a busier and more exciting experience, whilst some have decided peace, quiet and more space is what they’d like.

These changes in priorities have resulted in an increase in UK rental demand in recent times, one that looks set to continue for the foreseeable future.

UK rental demand is set to increase

A recent announcement by the Bank of England put things into stark perspective for what we could see in the economy through winter and into next year.

As reported by the FT, ‘Britain faces a protracted recession and the worst squeeze in living standards in more than 60 years after the Bank of England raised interest rates sharply and forecast inflation would hit 13 per cent by the end of the year.

The Bank’s nine-member Monetary Policy Committee voted 8-1 to raise interest rates by 0.5 percentage points to 1.75 percent on Thursday, the biggest increase in 27 years.

The BoE’s move followed similarly aggressive steps by the European Central Bank and US Federal Reserve in the face of soaring inflation.’

Not only this, but the Bank also warned of an impending recession, with the BBC reporting ‘The Bank of England has warned the UK will fall into recession as it raised interest rates by the most in 27 years.

The economy is forecast to shrink in the last three months of this year and keep shrinking until the end of 2023.’

What does this mean for investment property, landlords and investors? The likelihood is that property prices will drop marginally over the course of this period, however, that has the knock-on effect of taking many first-time buyers out of the market as incomes are squeezed.

This in turn means that instead of buying, many will need to either continue renting or rent for the first-time. Given the existing discrepancy between supply and demand, an increase in UK rental demand in the market is likely to see rents continue to grow at a good rate, meaning strong returns and yields for property investors.

What does this mean for property investment?

If you’re looking for a quick profit on property prices increasing, then now isn’t the time, however, if you’re looking for excellent incomes and returns, as well as asset price growth in the longer term, then it’s absolutely the time to consider investing.

If you’re interested in some of the best investment properties on the market, with many already tenanted, then why not speak to one of our specialists today about what you’re looking for?

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