Well 2020, you've certainly kept things interesting...! As the UK begins to bounce back from the Coronavirus lockdown, analysts begin to speculate on what the future holds for the UK economy. Here at Baillie White, we are going to concentrate on the future of the rental market in our corner of Essex.
In both sales and rental markets, many agents including ourselves have been able to stay in the game by offering virtual and online viewings and delayed moving dates, having tenants on standby to move when it's safe to do so, once all the paperwork has been sorted in the background. According to Zoopla, the average time to let in usual market conditions is three weeks. That seems awfully slow to us, we aim to get your tenants ready to move within one week, but let's use Zoopla's figures. The average time for a sale to complete is around three months, and this is being credited as a big factor in why the rental market is expected to bounce back more quickly than the sales market.
Broadly speaking in fact, the Coronavirus pandemic and the associated lockdown appear currently to have had little effect on the local rental market, with listings only dropping by around 3% between March and June. In Benfleet, the highest demand continues to be for 2 bedroom properties in the £900-950 pcm range and Canvey Island renters prefer 2 bedrooms too, with the most popular price bracket at £850-875 for these.
There is a great deal of speculation currently about the future of the UK housing market, with many experts expecting prices to fall in the coming months and years due to decreased demand as a result of job losses and financial insecurity. There are still many more who believe that we could even be looking towards a property boom in the years up to 2025, with a dip to follow, once the effects of the government life-rafts being thrown out currently begin to wear off. High Street lenders such as Nationwide have temporarily withdrawn their 90% LTV products making it more difficult for first time buyers to get on the ladder.
What could this mean for the local rental market? Well, people will always need homes, and in today's fast paced world, many home hunters will be looking to 'try before they buy' in Benfleet and the surrounding areas whilst others move into the area for work, especially into South Benfleet, Pitsea and Leigh on Sea with their excellent commuter links to London. The rental market may well become more buoyant as first time buyers postpone their decision to buy, to wait for more favourable market conditions.
So, with the rental market having been on an upward trajectory since 2017, can we still expect this trend to continue in the 'new normal' post-lockdown UK in 2020 and 2021?
Ultimately it's about supply and demand, rental demand has increased year on year whilst supply dwindles, as many private landlords are pushed out of the market by ever changing and increasingly more time-consuming legisltation and licensing. This has meant that the landlords still in the sector have continued to see a projected 2.4% annual growth in 2020 so far.
Government support looks set to continue for private renters for the foreseeable future, and with the evictions ban coming to an end on the 23rd August, many landlords will see it as safe to go back in the water. To many in fact, it may seem like there has never been a better time to rent out your property to the right tenant at the right price. We continue to look to the future with optimism and whilst the effects of the lockdown have been devastating for many, remain confident that 2021 and beyond will present new and exciting opportunities for savvy investors and landlords.