Our regional update this month focuses on:
- Comparisons on the rental values between PE27, PE28 and PE29
- What homes have seen the biggest rental yields year-on-year?
- How the markets changes are affecting behaviour
The rental is very buoyant. For a good property at around £1,000pcm, we have an average of 27 applicants who show interest. Over £1,200 it goes to 17. There are a lot of people out there looking.
Why is the market buoyant? Well it is because there are 32% less properties coming on to the market to rent than last year. Supply is definitely not matching demand and rents are increasing. For the area we cover we have seen an average increase of 8% year on year for properties in the PE areas and 9% in the CB areas that we cover.
We keep a record of what is happening so that we are best placed to give you the right guidance when looking at rental reviews and also when you are considering extending your portfolio.
What is happening in PE27?
What is happening in PE28?
What is happening in PE29?
‘That looks a bit high!’
These figures are what we achieved for properties. The PE29 figures have seen such a high increase here because they have been somewhat skewed due to a property let at £4,000 – which is way above the norm. Taking this one out the average increase we have seen is 7.5%.
Which areas have the highest year on year increase by number of bedrooms?
Interestingly, the media has been reporting that 28% of peoples’ salaries are going on monthly rental payments – but we look at affordability of a minimum of 2.5 x the household income compared to the rental. Ever has it been thus. Therefore, for a rental of £950 per month we would be making sure the household income was no lower than £28,500. Given that salaries in the area are on average £51,400 – we are in a good area.
Typical yields for Maxine Lester landlords
The average gross rental yield that we can see our landlords achieving is between 6.4% to 26.9 %.
These are landlords that have been working with us for more than one year and, in the main, have increased the rental on an annual basis.
How the lack of supply is changing tenant behaviour
It will not surprise you that once a property below £1,000 per month goes on the market, it is very quickly snapped up. However, because competition is so strong, people are agreeing to take several properties with different agents. Since we are only allowed to take the equivalent of a week’s rent (see Tenant Fee Ban!), there is very little cost to agreeing to take a property. We are keeping a close eye on this to make sure that your void period is not increased.
If you want to hear about other figures in Cambridgeshire just ask – we have tons of data!