Following on from the recent release of our annual marketplace predictions, we wanted to add another angle of opinion on predictions for 2016's rental market. With this in mind we published a Landlord Survey.
Following on from the recent release of our annual marketplace predictions, we wanted to add another angle of opinion on predictions for 2016’s rental market. With this in mind we published a Landlord Survey which asked a series of questions to landlords from across the UK (not necessarily Belvoir landlords) to help build a projection of where they believe the market has shifted to, their plans for 2016 and the challenges they believe landlords will face in the next 12 months.
When asked what their investment objectives are, 43% of landlords answered to say that they would describe themselves as investment landlords, the smallest percentage of just 3% said they were investing in property to help prepare for their children’s future. Interestingly, 10% of landlords have invested in property to help pay off their residential mortgage with a further 16% investing as a scheme to help them to save for their retirement, a method that is becoming ever popular within the rental marketplace.
There is a clear theme of discomfort when asked what the largest challenge for landlords will be in 2016. The recent announcement of new taxation and stamp duty entering the market has clearly led to some worry and doubt within the market, many landlords admitted to us that the government’s new plans have left them feeling uneasy about investing. 44% of landlords say that they will be watching the market closely before deciding to invest within the next 12 months with some even expressing that if they were to invest in 2016, it may even be as a limited company.
In our 2016 Predictions, we projected that there would be a rental increase in 2016 of around the 3% mark – this is reflected by landlords who completed our survey with well over half confirming they have not put rents up in the last 12 months and many intending to raise rents by 3% - 5% in the next 12 months. Some landlords, however, confirm they will maintain current rents with 46% planning no rental increase in 2016, this is a relatively surprising result and could be interesting to watch, our Managing Director, Dorian Gonsalves was quoted in our recent forecast as saying ‘we are forecasting modest average rental increases of 3%, but should the shortage of property available to rent reach crisis point rents are likely to rise further.’
In 2015 we saw city centres become a real hotspot for rented property, with the prices of rent within city centres reaching new heights, many landlords are anticipating a shift to cheaper areas towards the outside of cities and a shift further towards towns.
Overall we can see there’s definite links between the predictions we have made and the predictions and thoughts that landlords have shared with us. There’s an element of uncertainty within many landlords currently, however we ensure all Belvoir offices are equipped to give the best advice on the current marketplace and will be able to help guide you in the right direction to make the very best of your property investments over the next 12 months.