Rental values are at the heart of the relationship between landlords and tenants, and they play an integral role in the success or failure of a local landlord.
We are pleased to say we have supported many landlords in and around Peterborough, and setting an appropriate rental value is a crucial part of the work we do with landlords. However, market forces also influence the monthly price a tenant pays, and it looks as though these values will rise throughout this year.
RICS figures always worth considering in property and rental market
The Royal Institution of Chartered Surveyors’ (RICS) latest index gives reason to believe rent increases will continue throughout 2022. Respondents have reported a dependable level of growth in tenant demand across the United Kingdom.
The report also indicates a fall in the supply of rental property, with 27% more respondents referring to a drop in supply compared to the respondents stating they have experienced an increase.
The latest survey says: “As a consequence of the persistent disparity between demand and available supply on the lettings market, near term rental growth expectations rose further to post a net balance of 57 per cent in December [the latest figures]. When viewed by region, rents are expected to pick-up firmly across all parts of the UK, both at the three- and 12-month horizons.”
RICS chief economist Simon Rubinsohn has also spoken on this topic, saying; “Despite the termination of the stamp duty break at the end of September and the more recent increase in interest rates, the RICS new buyer enquiries indicator remained in positive territory into the year end. Although respondents to the latest survey continue to highlight a lack of stock on the market, they do encouragingly still see some scope for transaction volumes to edge upwards over the coming months.”
Simon Rubinsohn concluded by saying; “More of a concern is the suggestion that the mismatch between demand and supply will drive house prices even higher through the course of 2022. Rents similarly seem likely to be on an upward course over the next 12 months despite broader cost of living challenges emerging on the back of higher energy costs. And significantly, the longer-term metrics capturing five-year expectations suggests the industry for now continues to anticipate prices and rents outpacing wage growth beyond the end of this year in the absence of a major uplift in new supply.”
Are rising rental values always a good thing for landlords?
While some landlords see a headline about increasing rental values and think this is great news, there is obviously a lot more to think about.
There is a need to consider your ideal tenant, and what they can afford to pay. If rents continue to increase, it might cause upheaval in the marketplace.
It is one thing to replace current tenants with new tenants who are keen to pay more, but if there are no willing tenants at a higher rental value, landlords have tough decisions to make.
At Just Lets, we know the Peterborough rental market well. We have considerable experience in this sector, and we work hard to bring landlords and tenants together. If you require guidance or support, please contact us today.
Just Lets – Here to Help
If you are a landlord in or around Peterborough, and you need assistance in managing your rental property, we can help. We know these are challenging times for landlords, but there is a demand for rental property. When you need guidance in the local market, contact Just Lets Peterborough today, and we will be happy to help you.
The team at Just Lets Peterborough continue to operate remotely to ensure we can continue to serve you and your tenants throughout this covid period and beyond. Please contact us through our usual channels – email us at peterborough@justlets.com or call us today on 01733 346255.
