It has already been almost three months since the Brexit vote and landlords are said to have much to be optimistic about following the result.
Latest data released from Rightmove indicates that the average asking price of property is beginning to improve following June’s vote. According to the portal, the average asking prices for new lets have risen by 0.7%. This is equivalent to £2,277.
Additionally, the average asking price for a property coming onto the market is £306,499.
There was certainly a lift in landlords taking out landlord insurance on properties in the capital during the period between May and July. In this period, the number of new properties on the market rose by nearly 40%. Despite this, rents slipped by 4.1%.
However, the number of prospective tenants also rose by 7.2%, with the number of new tenancies agreed rising by one-fifth. Average prime rental yields stayed constant at 3.1%.
In addition, rents across Britain continued to rise in August, according to HomeLet Rental Index. Tenants agreeing a new tenancy last month, agreed to pay an typical rent of £913. This was a rise of 3.1% on the same month last year.
Reasons to be cheerful
Peter Armistead of Armistead Property, believes landlords and investors have many reasons to be cheerful in the forthcoming period. He noted: ‘mortgage rates are at record lows which is helping buy-to-let investors make deals. Despite the tightening lending criteria, finance is cheap and BTL investors are continuing to invest in the market. Last month, TSB launched a range of new fixed rate buy-to-let mortgage products with interest rates lowered on certain products by up to 0.4%.
‘The Bank of England’s cut in the base rate last month for the first time in seven years, will have boosted investor confidence. Research from Connells Survey and Valuation shows buy-to-let activity surged 12.7% in August, he continued.
Concluding, Armistead observed that landlords are enjoying superb yields outside of London. He said: ‘Landlords are enjoying excellent yields outside London and many are enjoying returns of between 4-6%. Manchester has some of the best rental yields in the UK, with annual rental yields of 6.02% over five years. An average residential property in Manchester is just £155,000, while a flat in a good area, costs as little as £120,000. A property in Manchester can provide a 5% minimum cash rental yield and a typical 12% total cash yield, including 7% capital appreciation. Demand for rental accommodation is strong and by comparison with other regions, housing is cheaper.’