We wanted to share the latest rental report issued by Zoopla, which shows changing rental sector trends due to the COVID19 pandemic. The good news for property investors locally is that despite the decline in demand in other parts of the UK, the East Midlands' property sector remains buoyant. The annual percentage change in rent in Nottingham has increased by 4.1%, the third-highest in the UK. Also, demand is growing in Mansfield by 7.1%.
Here are some of the facts published in the latest report which we think you will find interesting.
Annual UK rental growth increases outside London
Rents are rising year-on-year in most regions across the UK, with the exception of the West Midlands (0%) and London. In Nottingham, we have seen a rise in rent by 4.1%. Currently, the average rent is £739 per calendar month.
Demand and supply
The demand for rental property is still rising across the UK, with total demand from renters in January some 21% higher than the same month last year. The supply of homes 'to-let' has decreased by 11%, causing upward pressure on rents in many areas.
Demand in some well-connected towns across the country is putting particular upwards pressure on rents, with rental growth of more than 7% seen during 2020 in Rochdale (+8.2%), Hastings (+8.0%) and Mansfield (+7.1%).
Increased supply of rental homes
The rise of working from home, which has gained traction throughout 2020, means that a cohort of workers who typically rent in the centre of town for work have located elsewhere on a more permanent basis. This means more city centre stock has come back onto the market rather than rolling over into a new rental contract.
More demand for space
Changing working patterns is again playing a part here. The data indicates some office-based renters are looking forward, post-lockdown when flexible working is likely to continue. Data shows that renters are looking for homes with more space, indoor and outdoor, the stock which is more likely to be found in the wider commuter zones.
The pandemic has disrupted some of the key drivers of demand in the rental market – including labour mobility, migration and employment growth. Despite this, we have seen a rise in localised demand in some areas, as some renters look to relocate.
Flexible working is likely to continue, meaning there may be a permanent shift in priorities for some renters regarding the location and property type. The 'search for space' will likely continue, supporting the rental market for family houses.
We are very optimistic about the outlook in the East Midlands. If you are planning to invest in Nottingham or Mansfield, we will be able to help you. Contact us by calling 0115 704 3163 or 01623 277115. Alternatively, you can email us via our contact us page – click here.