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Introduction: The Post-Lockdown Lettings Market
Following the spring lockdown, the lettings market began to recover after a period of inactivity. However, research from Hamptons International indicates that rentals are rebounding more slowly compared to the sales market.
Sales Market vs. Rental Market Recovery
While the sales market continues to perform well, the rental market is experiencing a slower, U-shaped recovery rather than the anticipated V-shaped rebound.
Factors Affecting the Rental Market
The number of first-time buyers has increased, partly due to the Chancellor’s stamp duty holiday. However, job insecurity among young people has led to delays in renting, and landlords' reluctance to invest has contributed to a reduced supply of rental homes.
Rental Market Forecast: A Challenging Outlook
Rental growth is expected to lag behind house price inflation, with rents predicted to fall in 2020 and 2021. In London, rents are expected to drop by 3% this year and 1% in 2021, raising concerns for landlords managing financial obligations.
Key Factors Influencing Market Stability
The rental market’s recovery will depend on economic factors such as employment rates and wage growth. Until tenant earnings improve and job losses stabilize, rental prices are likely to remain under pressure.
Future Prospects and Landlord Considerations
There is hope that the market will stabilize by late 2021. However, much depends on easing travel restrictions and vaccine distribution. In the meantime, landlords must carefully evaluate the viability of their rental properties.
Meet our Expert Property Commentators
Mary-Anne Bowring FTPI FRICS FARLA FCABE Founder/Head of Asset Management
Strategic partnerships, holistic delivery/ opportunities, growth, value engineering, thought leadership
Ian Barber MD BTR Mobilisation & Leasing
Runs HQ & site lease-up teams. Drives rent pricing, mobilisation, marketing, happy residents!
Jon Curtis MRICS Head of Building Engineering
Chartered Building Surveyor. Lectures on EWS1 & building safety. Runs CapEx programmes.
Kate Robinson MTPI MD Blocks/FM Management (London Region)
Master plan setup, ops and staffing and resident engagement. ISO45001 champion.
Lee Harle Partner Ringley Law
Plot conveyancing. Debt litigation. Group Company Secretary.
Anthony Kingdon MIRPM AssocRICS MD Blocks/FM Management (North Region)
Stakeholder engagement. Mixed tenure specialist. Budget management. Plant audit, PPM compliance.
Chris Georgalis MRICS Head of Commercial Valuation
Chartered Valuer. Rental valuations: retail, leisure. IRR modelling and valuations for secured lending. Compulsory purchase & rent reviews
Nichola Pughe MRICS Head of Residential Valuation
Chartered Valuer. Rental development & mixed use valuations, IRR modelling. Leasehold enfranchisement specialist
Natalie Birmingham Helpdesk Support Manager
Trainer & Helpdesk Manager: people, systems,contractors. ISO45001 supply chain accreditation.
Steve Norman Planning Director
Land due diligence (opportunities & constraints) Has contributed to a number of award winning schemes.
