WHAT’S IN STORE FOR THE 2018 LETTING MARKET?
2017 remained buoyant within the lettings market with our lettings department hitting record figures of properties being let and new tenants moving in month by month. Our managed stock levels have also grown significantly in the past year which shows that the uncertainty over Brexit and changes in tax have certainly not put off investors buying in the area.
There are some significant changes happening in 2018 which landlords need to be aware of:
Minimum Energy Efficiency Standards
From 1st April 2018 all properties that are being marketed to let or having a renewal tenancy put in place must have an EPC rating of E or above. The idea behind this is to increase the quality of housing stock in the rental sector and to push landlords into doing necessary improvements on their properties.
Tenant Fee Ban
Whilst there is no date currently set by the government all agents and landlords must be aware this will be happening at some point. The ban will mean some agencies loosing large percentages of their income which will have to be found from other areas otherwise they may have to lay off staff or for the much smaller departments possibly ultimately close down.
In 2017 the build-to-rent sector grew rapidly and this looks set to continue into 2018. The British Property Federation have stated that just under £96,000 build to rent homes are currently constructed, under construction or in the planning stages. With many buyers still struggling to get on to the property ladder this sector has developed massively.
2017 was a good year for price growth with the last Nationwide monthly report showing 2-4% growth throughout the UK. This growth is set to continue into 2018 but perhaps slightly more modestly in 2018. This is good news for long term investors who are looking for capital growth. Rents are likely to rise significantly over the next 1-2 years due to landlords trying to recoup costs incurred by landlords being charged more fees as a result of the tenant fee ban.
We remain confident these changes will help to develop better quality housing stock available to tenants which will justify the potential increase in rents over the next few years. We also feel that the fee ban along with mandatory client money protection which was put in place in 2017 will mean that rogue lettings agents will not be able to survive.
If you are looking to dip your toe in a buy to let or looking to expand your portfolio and would like some advice then please contact Thomas Miller or Laura Fiddes-Baron on 0121 445 7410 or email firstname.lastname@example.org.