Rental market overview in Cambridgeshire

The focus over the last couple of months has been the Renters (Rights) Bill which is now at committee stage. As Labour has a massive majority it is expected to pass quite quickly and may be law by April / October 2025. As I have covered this quite a bit in separate blogs I won’t go into any more detail as it is all conjecture now and as the Renters (Reform) BiIl at the committee stage changed a great deal of things. As we go into November, we are seeing the usual slow down in the market as less people are looking to move. The number of landlords deciding to exit the market and sell the property has levelled off, but we are seeing more deals with landlords selling to new landlords ie leaving the property in the PRS.

Types of properties available

The spread of bedrooms remains the same with two bed homes making up the majority.

Property availability

The graph above shows the number of properties that were available to rent in the area in the year so far (figures from Rightmove). As you can see here have been no massive changes – on average there have been 340 available each month. The growth for October only reflects the normal pattern for the year as the market slows. However, if we compare with October 2024 with October 2023 there has been a 16% increase of properties available for this year.

Activity

Rightmove shows that on average, 59% of properties are let that are available in the month. In October the figure was 62% – so just above average – which meant a total of 158 properties were let in the Cambridgeshire area we cover.

As I have always said the market is driven by supply / demand / affordability

In October we advertised an average of 19 properties each week but received less applications than previous months. However, this just meant the number of people who were proactively looking (as opposed to window shopping) was far higher than in previous months. Given the fact that less initial applications lead to the same number of deals it could be that the market is reversing to a more stable situation. As a business this has allowed us to be able to work closer with applicants in order to help them find a property which is the first time, we have been able to do this in a year and a much better position to be in to offer better customer service.

For those properties checking – in in October it took an average of 8.5 days to find a tenant for properties with a rental up to £1,000; 19 days on average from a rental of £1,001- £1,500 and 42 days for rentals from £1,501 to £2,250. The overall increase can be put down to two properties where the prospective tenants pulled out at the last moment. This means our average from the beginning of marketing to finding a new resident has increased from 16 days to 24.

Rental comparisons for PE27, PE28, PE29, CB23 and CB24

You know we love a database and by having this type of detail we are best placed to give you the right guidance when looking at rental reviews and when you are considering extending your portfolio.

These average figures come from our records. Therefore, they are a mixture of the rent reviews that have been put in place over the last year. Plus, the rental figure achieved at the point of remarketing and are split by the number of bedrooms.

Overall a:

• 1 bed property is now achieving on average £858
• 2 bed property is now achieving on average £973
• 3 bed property is now achieving on average £1,200
• 4 bed property is now achieving on average £1,670

Which areas have the highest year on year increase by number of bedrooms?

The year-on-year rental has shown that PE29 has now performed better that PE27 . which has held the top spot for quite a few months for and 2 bed homes. However, Pe27 stays in the lead for 3 bed homes.

The average increase over the area is still around the 13%. Again, the main driver of these increases is down to mortgage rate rises and although the supply has slightly increased we are still seeing and average of 15 people actively applying for each property. We also seeing landlords with long term residents who historically have kept rents lower than market rate now asking for an increase to market rate or in some cases higher than market rate as their mortgage has increased.

Has prospective tenants’ behaviour changed?

No change here from recent months – but we are seeing more people not be quite as open on their initial conversations with us.

Again, fall outs are a growing concern. This is where an applicant agrees to take a property and the reference has been carried out but they pull out before we move them in as they have found another property. This can only be put down to the fact that the competition is still high so that people will apply for a number of properties at the same time to make sure they get one.

However, we are still finding that affordability is very much coming into play. Due to lack of supply prospective tenants are having to spend more than 30% of the household income on rent.

What return can I expect?

As I have said many times before this is very much down to when you bought the property.

In this market the average gross rental yield that you should expect is anything between 5 – 6%.

If you are considering extending your portfolio why not book in a call with me to discuss the off market opportunities we have available.