In this blog about rents in Cambridgeshire, we shall be covering:
- How rents have changed over the last year and why
- How we have adapted to the change in the market
- What drives rentals returns
The Cambridgeshire rental market has changed dramatically over the last 18 months. If you have had a property that has recently been marketed, you would have seen an above average increase in the rental achieved and a drop in the void period too. You would have also seen that your property would have most probably been taken on the first day of viewings.
I would love to say its all down to the fab way we market your property (well part of it is!) but in the main, it is all down to the fact that there are 37% less properties to rent on the market in Cambridge and more people looking to rent. Demand is at an all time high.
In 2022 we saw a drop of 26% in void periods and an average increase of 8% on rentals achieved. However, where owners decided to redecorate or lay new carpets, we saw the rental increases of up to £230 a month.
However, we have also seen the highest number of dropouts from people agreeing to take on a property. Then subsequently finding another home and dropping out of their first choice.
This is due to two factors:
- Because demand is so high people tend to take the first property that looks to meet their needs. But whilst referencing is going through, they find another property that is more suitable so drop out of their first choice.
- Due to the tenant fee ban there is very little consequence monetary wise to the tenant. Which was something predicted by the industry from the start!
To cater for the higher demand, we have had to adapt the way that we market properties to give a larger audience a chance. Applicants’ behaviour has also changed, in that we now receive very detailed information on what they would be suitable for a property to make sure they get on the landlords list to choose.
Where we have tenants in situ and the tenancy comes up for review. We have been achieving an average of 7.6% increase on the year before but again this will depend on any redecoration or upgrades that have been carried out over the last year.
The driver to higher rental yields has two factors:
- Is it affordable?
- Supply and demand
Affordability is down to salary, and we are very lucky to be in an economic positive bubble due to the variety and type of employment we have. According to Propertydata, salaries have increased by 5.7% over the last year. Therefore there will be a limit to how high rentals will go but, whilst we are seeing high demand, it does not seem to be immanent.
If you would like to understand what the market rate is for your investment property, just give us a call on 01480 494939