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What are we seeing in the regional BTL lens?
The UK rental market continues to present opportunities for landlords due to the ongoing imbalance between supply and demand, though challenges persist. Careful portfolio management and diversification strategies are crucial for success.
Regional Disparities
Rightmove's research highlights significant regional differences in rental demand:
- Wrexham ranks as the busiest rental market, with 54 enquiries per property on average
- Glasgow and Bristol follow closely with 52 and 51 enquiries per property respectively
- The UK average is 19 enquiries per property
Market Trends
Despite high demand in certain areas, the UK rental market is gradually moving towards balance:
- Tenant demand has fallen 16% compared to last year
- Available rental properties have increased by 8%
- However, rental homes are still 32% below 2019 levels
Average rent outside London has reached £1,349 per month, a 5% year-on-year increase, though this represents a slowdown from 12% growth in 2022.
Regional Growth
According to Hamptons:
- The North West leads rental growth, with a 53% increase since 2019
- Wales has seen the weakest growth at 19%
- Adjusted for inflation, real term rental growth across the UK averages 2% annually since 2019
Market Outlook
There's cautious optimism in the buy-to-let market, particularly for landlords committed to long-term investment strategies. Opportunities exist in responding to current demand and anticipating future needs as affordability issues persist for first-time buyers.
Tenant Perspectives
Research from Go.Compare Home Insurance reveals:
- 60% of non-homeowners believe they'll never be able to buy a home
- Many renters feel homeownership is too big a commitment (30%) or that renting is easier (28%)
- Some believe renting offers better value for money (17%)
Landlord Strategies
Successful landlords are focusing on:
- Geographical diversification
- Raising property standards to meet tenant expectations
- Investing in long-term property maintenance
- Offering energy-efficient homes to attract quality tenants
The private rented sector remains crucial to the UK housing landscape. While factors like interest rates, economic conditions, and government policies will shape its future, landlords with clear strategies and long-term commitment can still find significant potential in the market.
This article was originally published on The Intermediary
