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Surrenden Invest celebrates its seventh birthday

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April marks Surrenden Invest’s seventh year of operating, and, to celebrate this milestone, we are pleased to announce that we have sold over 2,000 UK investment properties since we launched.

2,000

Sold over 2,000 UK investment properties since we launched back in 2015.

£276,755

Today, housing prices have climbed to reach an average of £276,755 compared to £193,225 in April 2015.

£83,000

With property values increasing by around £83,000, demand has remained one of the most consistent factors over the years.

227,000

227,000 rental homes required per year to house renters across Britain.

The UK property market – seven years on

Over the last seven years, we have weathered the storm of three General Elections, Brexit negotiations, the UK leaving the EU, and the Covid-19 pandemic. Despite political and economic turbulence, we have seen first-hand the resilience of the UK’s property market in the face of potentially significant disruptions. Instead, we have seen the demand for investment property rise rapidly from domestic and international buyers, who share our confidence in the sector.
What’s more, we’ve witnessed the impressive climb of average residential property values. Back in April 2015, the average cost of UK property stood at £193,225. Today, housing prices have climbed to reach an average of £276,755 (Land Registry).
With property values increasing by around £83,000, demand has remained one of the most consistent factors over the years, and this trend is showing no signs of slowing down. In fact, around 227,000 new rental homes per year are required for the next ten years to meet tenant demand across Great Britain. As interest rates remain at a historic low, we stand by our message that now is a great time to invest in Buy-to-Let property to capitalise on demand.

Helping to ease the UK’s housing shortage

Throughout the past seven years, Surrenden Invest has made its mark on several property markets across the UK, selling high-performing Buy-to-Let investments to buyers worldwide. We are proud to have worked with some of the country’s leading and most established developers to deliver high-quality housing in cities like Newcastle, Liverpool, Manchester and towns in London’s commuter belt.
One sector the Surrenden Invest team has been particularly successful in is Build to Rent (BTR), helping to deliver high-quality, purpose-built residential housing in the most in-demand locations across the country. Surrenden Invest was one of the first property consultancies to adopt the BTR model, helping our clients profit significantly throughout this market segment’s evolution.
Our team’s passion for property has enabled us to produce positive results for investors and end-users alike by supplying quality residential housing to ensure that all of our opportunities meet the expectations of modern tenants. Working with established developers and our strict in-house due diligence allows us to promote quality projects which produce results for our clients while addressing the UK’s housing shortage.
Our high-star rating reflects our approach and attention to detail on Trustpilot, where you can read the latest Surrenden Invest reviews.

A market leader

Our unrivalled knowledge of the UK’s property market has seen the Surrenden Invest team feature in some of the world’s most-read publications. As a leader in our field, our team of property experts is always keen to share their knowledge with investors and those considering investing to help people make an informed decision.
Surrenden Invest has been featured in The Telegraph, The Times, Money Expert, Mortgage Introducer, and the Independent – just to name a few.  we are always happy to share our industry insights to help clients unlock the potential of the UK’s property market. Visit the In the Press section of our website to read our latest features.
The Surrenden Invest team has also been working hard behind the scenes to mark our seventh year of trading to create two new location guides for our clients. So keep an eye out on our website or sign up for our monthly newsletter to get the latest publications delivered straight to your inbox.
Follow this link to read our 2022 City Guides.

Looking to the future

As we celebrate our seventh year of operating, we will continue to keep our finger on the pulse of all things property to help us to pinpoint market trends that our investors can capitalise on. With several projects on track to complete in the first half of 2022, our birthday celebration couldn’t be any better, and we look forward to sharing the results across our website and on social media shortly. We have some high-performing Buy-to-Let investments in the pipeline, so make sure you are signed up to our newsletter to receive pre-launch notifications.

Finally, the whole team at Surrenden Invest would like to thank our clients for their support over the last seven years. We have enjoyed working and getting to know our buyers – many of whom have become repeat clients – and we are looking forward to building on the success of what we have achieved so far.

8.7% annual rental growth in commuter belt towns

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London is one of the world’s most-loved cities; however, the high cost of living in the capital has seen the number of people calling the city home decrease by 550,000 over the last decade. With international business opportunities and a wide selection of jobs attracting workers, more affordable property in commuter belt locations has emerged as a natural choice for tenants looking for a better value for money.
As a result, the cost of renting in commuter belt hotspots has increased significantly, according to a recent report released by Savills. In the year to March 2022, rental values have increased across commutable areas, with the average cost of rent up by +8.4% in cities, +8.7% in towns, +6.5% in rural locations, and +5.5% in villages.
For Buy-to-Let investors looking to pinpoint a commuter belt location for investment, proximity to transport links remains a top priority for renters as more people return to the office and pre-pandemic norms. Discover the post-pandemic London commuter belt hotspots.

+10.3%

The cost of renting in London increased by +10.3% in 2021 as more people returned to city living.

550,000

Number of people calling the city home decrease by 550,000 over the last decade.

+8.7%

Average cost of rent up by +8.4% in cities, +8.7% in towns, +6.5% in rural locations, and +5.5% in villages.

+£%

Many city workers have permanently swapped city living for commuting and plan to stay put in the city’s outskirts.

Tenants stay put as rents in London rise

We recently reported that the cost of renting in London increased by +10.3% in 2021 as more people returned to city living following the removal of most pandemic restrictions.
The rising cost of renting in the capital has forced many people who moved to commuter belt locations during the pandemic to reconsider their work-life balance. As more people work from the office part-time, less frequent trips have lowered travel costs for many tenants, making living outside of London more appealing than returning.
With rents climbing across London, many city workers have permanently swapped city living for commuting and plan to stay put in the city’s outskirts for the foreseeable future. There is a clear demand for new-build property within commuting distance of London for property investors and developers alike.

High-performing Buy-to-Let investment

Warwick House in Redhill is a prime example of a high-performing Buy-to-Let investment in London’s commuter belt that offers investors a fully managed apartment with excellent growth potential. Since launch, our investors have been quick to act on this rare opportunity to own a rental property in a popular commuter belt town.

With limited apartments available, contact Surrenden Invest to register your details and receive a copy of the brochure.

UK Build to Rent sector offers plenty of growth for investors in 2022 and beyond

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While an overall undersupply of property across the country is not breaking news, the most recent UK Build to Rent report from Savills has emphasised the shortage of rental stock as an opportunity for Build to Rent developers and investors.
According to the report, almost every local authority nationwide requires an increase in the supply of rental property, which has caused the cost of renting to jump in recent months. In 2021, the average annual rental growth rate increased by 8.3% across the UK, with a lack of stock and rising demand driving rents upward.

230,000

230,000 new rental homes are required across the UK per year to avoid a shortfall.

76%

76% of local councils have seen an increase in property investors converting residential BTL into Airbnb lets.

£4bn

Around £4 billion was invested in the Build to Rent sector in 2021.

227,000

227,000 rental homes required per year to house renters across Britain.

Gap between supply and demand widening

According to Capital Economics, almost 230,000 new rental homes are required across the UK per year to avoid a shortfall caused by the expected creation of 1.8 million new households over the next decade.
However, despite the large volume of rental property needed, UK Finance has reported a decrease in the number of available properties within the Buy-to-Let sector, with BTL mortgage redemptions increasing by 28,000 year-on-year, suggesting more landlords are selling up and exiting the market. Rising house prices are one reason for landlords offloading rental property assets, with some seeing market conditions as an opportunity to maximise equity gains as a key motivator.
However, indirectly, tax and regulation changes introduced by the UK government to improve market conditions for first-time buyers may have intensified the shortfall of rental properties, with some landlords turning away from the sector altogether due to affordability issues.
What’s more, the effects of the Covid-19 pandemic have shifted the market considerably, sparking a rise in the popularity of staycations and short term lets. Around 76% of local councils have seen an increase in property investors converting residential BTL into Airbnb lets, intensifying supply issues in areas already struggling with the availability of rental stock.
These factors are just some of the reasons why the number of rental properties provided by the Buy-to-Let sector is declining, which has fuelled a rise in renting costs.

Bridging the supply gap

For property investors and landlords, the scope for new-build rental properties to enter the rental market is one of the biggest takeaways from the Savills report. With a national fall in rental homes, the UK Build to Rent sector has offered encouraging signs for property investors to secure robust returns from Buy-to-Let property.
The report revealed that around £4 billion was invested in the Build to Rent sector in 2021 and, according to Savills, completed and pipeline projects Build to Rent stock accounts for 212,200 homes across the nation. However, compared to the reported 227,000 rental homes required per year to house renters across Britain, there is an apparent disparity between new stock entering the market and the creation of new households.
According to the listings portal Rightmove, the North East of England has seen the most significant decline in rental stock, with the number of available properties to rent 50% lower than the 2017-2019 average. Property investors looking for Build to Rent opportunities in the North East are likely to achieve some of the best capital gains on the market, with values expected to climb by 18.8% over the next five years.
Apartments in Surrenden Invest’s The Bank development in Hull are an excellent example of high-quality Build to Rent stock and offer investors a significant growth potential while addressing the overall shortage of rental property in the city.

What is Build to Rent and how does it work?

Build to Rent is a term coined for property design and developed to appeal to the needs of tenants rather than owner-occupiers. The UK’s Build to Rent sector has seen a steady and rapid rise over the last ten years, emerging as a viable way for developers and investors to provide high-quality, purpose-built accommodation, often in city centre locations for renters on the local market.
Each development is designed with the local property market in mind and often features desirable on-site facilities, including management and concierge, plus enhanced security features, including CCTV and fob lock entry systems. In larger Build to Rent developments, residents have access to hotel-style facilities such as a gym, communal spaces, and practical amenities such as bike storage, parking, and even storage space.
The Build to Rent market can cater to long-term and short-term tenancies and provides higher-quality rental accommodation.

What are the benefits of Build to Rent?

For tenants, one of the biggest benefits of the UK’s Build to Rent market is the value on offer, with end-users reportedly enjoying the lifestyle improvements provided by access to on-site facilities and management teams. The inclusion of some bills within the cost of renting is also deemed a positive by tenants, according to the latest findings of a HomeViews survey.
Overall, the UK Build to Rent sector has helped the quality of rental property stock increase, with tenants able to rent an apartment with high-end fixtures and furnishings that reflect their aspirations and lifestyle. The location of Build to Rent stock is also one of the most attractive pulls for renters, opening up city or town centre housing options for those who would not be able to buy in the same area.
According to Knight Frank, the Covid-19 pandemic has highlighted the importance of the Build to Rent sector and the ‘benefits of purpose-built, flexible, actively-managed accommodation’. With more people assessing what they need from their rental accommodation, the Build to Rent sector is in an excellent position to bridge the gap between supply and demand.
Investors early to adopt the Build to Rent model have benefitted from a steady tenant demand. With an on-site management or maintenance team in most locations, investors enjoy hassle-free rental property ownership as each development is fully managed. What’s more, the high quality of new build projects often means that investors secure high-calibre tenants.

The best locations for BTR property

As with all property investment purchases, purchasing an asset in the right location with a strong demand for the type of accommodation provided is vital. Location is a significant factor for renters, which is often why Built to Rent developments are situated in city or town centres where space for new-build property is at a premium.
Investors must consider the type of tenant their property will appeal to and factor employment prospects, connectivity, and access to amenities into their research alongside determining average rents, void periods, and the most desirable types of properties required on the local market. As experts in our field, Surrenden Invest conducts extensive research into each market we operate to take the hassle out of researching hotspots for Buy-to-Let investments.
For more information about the best locations to invest in the Built to Rent property sector, visit the City Guide section of the Surrenden Invest website. You will find out the latest range of downloadable PDFs that contain everything you need to know about the UK’s best-performing markets.

How to invest in Built to Rent property

The UK’s Build to Rent sector has plenty to offer property investors. However, for buyers considering an off-plan property within this market segment, it is vital to ensure that you invest in a project delivered by a reputable developer with an extensive track record.
To help you navigate the options available for investment, Surrenden Invest specialises in income-generating Built to Rent investments and has established relationships with leading developers operating in the market.
Our unrivalled UK property market experience and strict due diligence process ensure that we only promote reputable developments located in areas with an established demand for Buy-to-Let property.

For more information about investing in UK Built to Rent, contact Surrenden Invest today or visit our developments page to view our latest available properties for sale.

Post-pandemic London commuter belt property hotspots

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It is safe to say that the pandemic has changed people’s lives up and down the country. As the nation adapts to the ‘new normal’, the widespread introduction of flexible working, changes to commuter patterns, and the general approach to everyday life have changed the shape of what people want and need from their home environment.
As a result, city-centre living has changed across the UK, with London bearing the brunt of significant lifestyle changes. According to PwC, around 300,000 people left the city last year in light of the pandemic. What’s more, with London’s average office occupancy rate at 28% in December 2021 and TfL passenger numbers only at 41% of pre-pandemic levels, many city workers have not fully transitioned back into the office full time.

50%

almost 50% of London companies whose staff can work from home expect them to do so up to five days a week when the pandemic ends.

11.6%

Average cost of inner London rents falling by 11.6% (£305 less) when compared to the start of the pandemic.

2.0%

London has recorded the lowest level of house price growth across the UK, with values increasing by just 2% throughout 2021.

313%

Research suggests that average housing costs in an inner commuter belt location have risen by 313% over the past two decades.
Instead, according to Bloomberg, almost 50% of London companies whose staff can work from home expect them to do so up to five days a week when the pandemic ends, with smaller companies more likely to continue with remote working.
Naturally, as fewer people are required to work in the Capital daily, workers have reassessed their living situation. As a result, many people have opted to move out of the city and into commuter belt locations that offer good value for money whilst accessing a fast commute when required in the office.
This trend has been reflected across London’s property market, with the average cost of inner London rents falling by 11.6% (£305 less) when compared to the start of the pandemic. Moreover, according to Zoopla, over the last 12 months, London has recorded the lowest level of house price growth across the UK, with values increasing by just 2% throughout 2021.
As London’s annual rental growth and the potential for capital gains lags behind the rest of the country, evidence of the growing demand for real estate in the Greater London area – particularly in established commuter towns – is on the rise.
In this feature, the property experts at Surrenden Invest look at the best London commuter belt locations for buy-to-let investors in 2022 and what’s driving the demand for property outside of the Capital.

What is the London commuter belt?

London’s commuter belt has no fixed boundary and includes towns and cities in the South East and East of England. Therefore, locations with a direct train route into London are most favourable. However, major road links are often just as important.
The demand for property in commutable locations has steadily grown over the last 20 years, with Londoners escaping the Capital due to soaring living costs and the emergence of more reliable train links into the city. Research suggests that average housing costs in an inner commuter belt location have risen by 313% over the past two decades, transforming some areas into standalone property hotspots in their own right.

Best London commuter towns 2022

According to CBRE, the appeal of London commuter belt towns is more than just affordable house prices and travel times. Instead, those moving away from the Capital are looking to achieve a better work-life balance, opting for locations with convenient amenities and plenty of open green spaces. In addition, areas with an established identity within the commuter belt have been associated with a higher demand for homes.
However, property investors searching for an up-and-coming location with a lower price tag will be interested in some of Surrenden Invest’s best London commuter towns in 2022.

Sevenoaks

Sevenoaks is a prime example of a commuter belt location that has emerged as a UK property hotspot in its own right. According to a new Savills report, Sevenoaks has emerged as one of the most in-demand commuter towns over the last 12 months. And it is easy to see why. With regular trains running from Sevenoaks to Central London taking just 22 minutes, this picturesque town in Kent has seen average property values rise to £664,145, with values increasing by 9% over the last 12 months, according to Zoopla.
While Sevenoaks has emerged as sought-after locations for those escaping London, affordability remains a deciding factor, with the most desirable areas commanding the highest house prices and strongest demand. Given the established nature of the property market in Sevenoaks, where property values are not far from cost in London, savvy investors should consider options with a significantly lower entry-level onto the market whilst offering similar, if not the same, long-term gains.

Redhill

Located 20 miles from London, the town of Redhill in leafy Surrey has emerged as a firm favourite for renters and buyers alike who are looking to escape the daily commute in favour of a better work-life balance. Boasting excellent transport links with direct trains to London Victoria and London Bridge in around 30 minutes, plus easy access to the M23, M25, and Gatwick Airport, it is easy to see why Redhill has been named London’s second-best commuter town.
According to data published by Rightmove, the average house price in Redhill currently stands at £419,626. Housing values increased by 5% over the last 12 months in Redhill, further highlighting the popularity of this commuter belt hotspot.
However, the town has much more to offer its residents than an easy commute. Redhill’s ideal location and excellent transport links have helped the town establish itself as a business hub in its own right, housing the headquarters of large multinational companies, including SES Water, Santander Consumer Finance, AXA breakdown assistance, Travelers Insurance, and Aon.
For property investors, the town’s position between significant employment hubs, its strong local employment prospects, and excellent transport links means that demand for housing in Redhill is likely to remain high for the foreseeable future. As a result, property in the town offers buy-to-let investors the opportunity to secure a strong ROI from an undersaturated property market.

Woking

Recently named one of the best UK towns to live in by The Times, Woking is in the heart of the commuter belt and is just 20 miles from central London. Boasting frequent trains into the capital with an approximate journey time of 24 minutes, Woking has been ranked the sixth most attractive London commuter location by estate agent Jackson-Stops.
Residents also have easy access to the M3 and M25, plus Heathrow airport is also only a 30-minute drive away. However, Woking has more to offer its residents excellent transport connections. In fact, as commuter belt locations go, Woking has established itself as a cultural hub in the leafy county of Surrey. It is home to various attractions, including a world-class theatre, an award-winning museum, plus the town regularly hosts international exhibitions and food festivals.
Woking’s town centre offers its residents the best of both worlds. With a large shopping district that includes a variety of shops, bars and restaurants, access to open green spaces in the surrounding areas, and the picturesque Goldworth Park, Woking has emerged as a destination within its own right. Given the £460 million Victoria Square regeneration, which includes the construction of new-builds, a Hilton Hotel with a sky bar, a vast Marks & Spencer superstore, plus additional commercial space, this commuter town is likely to remain a top target for investors.
With a large number of renters looking to commuter towns like Woking, which offer more affordable rental property, buy-to-let investors are in a prime position to provide housing to accommodate the rising demand from tenants. Those comparing property investments will be interested to know that according to data published by Rightmove, the average house price in Woking currently stands at £544,035.
Over the last year, values soared by 8% in Woking, as more people move away from London in their droves. And, when it comes to the rental market, there are plenty of positives for investors and renters alike.
Data released by Home.co.uk shows that the average rent in Woking is currently £1,562 PCM. Compared to London, where the average property rents for £3,366 PCM, prospective tenants stand to save money and secure a more spacious property to suit their budget.
However, it is not just locations located south of London that draw Londoners away from the city.

High Wycombe

Located halfway between London and Oxford, High Wycombe is a well-connected commuter belt location with fast rail links to London and Birmingham. It also has the additional benefit of offering direct access to the motorway network. With access to London Marylebone station taking around 30 minutes, High Wycombe is a large market town in Buckinghamshire.
As an established property hotspot, the prestige of living in High Wycombe has helped to see property values in this quaint town climb by 8% over the last 12 months, with the average value of housing currently standing at £381,015. Property values in the town are likely to climb over the foreseeable future, especially in light of the successful bid for an £11.7 million Government’s Future High Streets Fund (FHSF). High Wycombe will see a wave of regeneration projects across its town centre and infrastructure improvements over the next few years.
Buy-to-let investors searching for capital growth potential should consider High Wycombe for future opportunities, with the aim of securing property near the train station to maximise its appeal to commuters. Click here for a sneak peek of our available buy-to-let apartments in High Wycombe.

Luton

Located just 22 minutes from central London and with London Luton Airport (LLA) classified as one of only 24 Enterprise Zones across the whole of England, Luton is a burgeoning town that could see massive growth in the years ahead. Strengthened by the recent announcement of a significant expansion for LLA as part of the London Luton Airport Vision for Sustainable Growth 2020-2050 plan, the coming years could see increasing scope for new property development to cater for the rising demand for property.
What’s more, with the average property price currently standing at £292,660 (up 5% over the last 12 months), Luton provides buy-to-let investors with a significantly lower entry-level option for those considering buying a commuter belt property.

Outlook for commuter belt property

Although on the surface, it appears that the pandemic has driven city workers out of London, the fact is that the amount of people relocating outside of the capital has been an ongoing trend, with many first-time buyers and renters moving out due to affordability issues.
Looking to the future, the 5-year forecast for South East England and the East of England is strong, with property values expected to climb by 10.4% between 2021 and 2026 in both regions (Savills). Compared to London, where house prices are forecast to rise by 5.6% over the same period, investors can expect to see almost double the growth rate from an investment property located in London’s commuter belt.

If you are considering investing in London commuter belt property in 2022, contact Surrenden Invest for more information about our latest selection of buy-to-let investments.

Demand for private rental property soars

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According to data released by Rightmove, private rents are climbing at a record pace as tenants compete for rental properties in city centre locations across the country. As more people return to the workplace following the easing of Covid-19 measures, demand for rental property has increased.
The cost of renting has reached a record high in London, with data showing that rents have bounced back higher than they were before the pandemic. The average price of renting a property in London now stands at an average of £2,142 per calendar month.
Outside of London, rents have increased by 9.9% over the last year, with the average cost of renting standing at £1,068 per calendar month.
An imbalance of supply and high tenant demand has caused a post-pandemic surge in the cost of renting, with the number of people searching for a rental property 32% higher than a year ago. In terms of supply, the number of available options on the property portal Rightmove is 51% lower than one year ago.
For those considering buy-to-let property investments this year, the figures in the report highlight the continued demand for rental property across Britain. However, with the government unable to deliver on its promise of 300,000 new-build properties per year to ease supply issues, private developers and investors are in a prime position to provide high-quality housing solutions in some of the UK’s most undersupplied markets.

£2,142

The average price of renting a property in London now stands at an average of £2,142 per calendar month.

9.9%

Outside of London, rents have increased by 9.9% over the last year.

32.0%

Number of people searching for a rental property 32% higher than a year ago.

300,000

Government unable to deliver on its promise of 300,000 new-build properties per year.
If you are searching for the best locations for Build to Rent property investments, visit the 2022 City Guide section of our website to download our latest market reports. In other news, data released by estate agent Hamptons has revealed that the UK’s property market is set for a record year in 2022, with house prices set to continue to rise over the next 12 months.
With historically low interest rates and mortgage deals available with lower deposits, now is an excellent time for buy-to-let investors to consider the options available to them on the market. If you’re considering a rental property, use our Buy to Let Mortgage Calculator to determine your monthly repayments.

For more information, contact Surrenden Invest today.

5 reasons to invest in property in Hull

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Pinpointing where to buy is one of the most important decisions property investors must make, factoring current market conditions and future growth into the equation. Despite its strong market fundamentals, Hull has flown under the radar as a hotspot for property investment until now. In this feature, the experts at Surrenden Invest outline the top 5 reasons to invest in property in Hull and why this underrated Northern Powerhouse city has plenty to offer investors.

Unrivalled growth potential

Hull remains one of the most affordable buy-to-let locations in the UK. With average prices 20% lower than the likes of Manchester and 65% below the UK average, the city has started to attract an increasing number of buy-to-let investors looking for greater capital growth, yields and living conditions than the “go-to” regional cities for investment can now offer.
With the price average property in Hull currently standing at £157,576, significantly lower than the UK average of £270,708, the market has plenty of room for future growth. Even with the most conservative outlook, with property values rising in line with the UK average, investors stand to secure increasing equity within their assets over the coming years.
Looking to the future, property values in Hull are on course to see further growth, with the latest five-year forecast from Savills predicting an 18.8% rise by 2026. Compared to the UK’s average expected gains of 13.1% over the same period, Hull is on track to reward property investors with more robust house price growth.
Early investors entering this emerging property market will be rewarded with the most substantial long-term growth potential.

£157,576

Average property price in Hull currently stands at £157,576.

18.8%

Latest five-year forecast from Savills predicting an 18.8% rise by 2026.

13.1%

UK’s average expected gains of 13.1% over the same period.

£1.5bn

£1.5 billion worth of investment over the last eight years.

£1.5 billion worth of investment

With £1.5 billion worth of investment over the last eight years, Hull is rapidly transforming from an industrial port city into an area undergoing a cultural and economic renaissance.
For buy-to-let investors, the timing of Hull’s rise to prominence is arguably one of its strongest appeals, with several city centre and waterside regeneration schemes coming to fruition in relatively short succession.
Following an £11m government-funded redevelopment in light of its 2017 UK Capital of Culture status, Hull’s City Plan is set to build on its success with a £27 million transformation of its historic fishing ports into a world-class waterfront destination for tourists and businesses.
The £83.6 million regeneration of the Fruit Market is at the forefront of the waterfront revitalisation, which is now a hotbed for independent restaurants, shops, galleries, and businesses, and the home of Arco’s £16 million headquarters that will provide 200 new jobs to the area.
Moving towards the city’s centre, a wave of investment has injected life into the streets of Hull, with the £96 million Albion Square development leading the way for new commercial, residential, and green spaces.
However, the city centre transformation doesn’t end there. The careful restoration of existing city centre buildings into innovative living spaces like the recently completed £22 million Glass House building and the iconic BBC Building, which sit by Hull’s Queens Gardens and just moments from The Bank, is a representation of the quality of housing that is required on the local property market.

UK Capital of Culture status

Securing UK City of Culture status is an accomplishment hard to come by, and during its four-year reign, Hull showcased the best it has to offer.
Its UK City of Culture status gave the city’s most impressive landmarks and colourful history a new lease of life, welcoming a new wave of tourists to the city. In addition, a wave of investments revamped the city’s most attractive features, including the Queens Victoria Square, the Hull New Theatre, and the redevelopment of central spaces to deliver galleries, entertainment venues and bars.
From stylish drinking and dining venues to the Trinity Open Market in Hull’s Old Town, from the new Fruit Market to the wider transformation of the waterfront into a world-class location for tourists, there are many things to do in and around Hull.

Regional employment hub

Launched in 2013, Hull’s 10-year City Plan has seen the city undergo a rapid transformation. Initially set to create 7,000 new jobs, the plan exceeded expectations, delivering 20,000 additional jobs and adding £3.5 billion worth of investment.
Encouragingly for property investors, Hull’s Economic Strategy 2021-2026 is set to build on its success and economic growth, propelling the city into a new era of expansion.
Despite the pandemic, Hull’s employment rates were at their highest, with local wages rising faster than the national average and investment levels in the city reaching an all-time high. In fact, the 2020 Demos-PwC Index showed that Hull was amongst the then least affected cities economically by the pandemic.
In recent months, Hull has been leading the rebound of Britain’s jobs market, ranking fourth in terms of its rate of recovery. With the number of jobs in Yorkshire and the Humber expected to grow by 45,000 by 2030, the demand for high-quality rental accommodation, particularly in desirable locations like Hull’s city centre, will rise.
The introduction of the newly completed £7 million K2 office building and the regeneration of the 60,000 sq ft of space at Hammonds of Hull into an impressive food hall and retail centre will improve employment prospects and the overall desirability of the city centre.
Ranked within the top ten most improved UK cities as a place to live and work, Hull has also become an increasingly attractive option for tenants and investors alike. With the city and its economy expected to expand over the coming years, investors searching for long-term returns are in the perfect position to capitalise on opportunities in Hull’s private rented sector.

Is it time for landlords to increase rents?

As demand for rental property continues to outstrip the number of available options on the market, rents are likely to remain buoyant due to competition from private tenants. For landlords with tenants already in place, Zoopla has advised that despite the New Year bounce-back from renters, the demand peak has begun to ease in February, indicating that less competition will reduce the scale of rental growth across the next 12 months.
Affordability levels also remain a concern for renters so, if you’re considering increasing the monthly price of your rental property, it is worth researching the local market before re-listing. Instead, savvy landlords may wish to renegotiate longer tenancies with existing tenants in a bid to secure higher occupancy levels.

Excellent transport links

For future growth, areas like Hull, which benefit from excellent transport links, open up opportunities for businesses, residents, and investors. With impressive road, rail, air and port connections across the UK and international destinations, Hull is one of the best-connected cities in the North of England.
To support the city’s future growth, a £355 million investment to improve Castle Street – one of the busiest roads in Hull – will help ease travel on the A63, improving access to and from the city’s most significant regeneration projects.
For international travel, Hull is served by Robin Hood and Humberside airports, both within an hour’s drive, and regular ferry routes operate from the port to Holland and Belgium.
Direct rail services to London links Hull to the capital in around two hours and 40 minutes, whilst the M62 motorway connects Hull with its Northern Powerhouse neighbours Manchester, Liverpool and Leeds.
For investors, locations like Hull, which boast an established transport network, highlights the ongoing appeal of the area for businesses and, within a rising number of companies operating from the city, the demand for property is likely to rise.

Outlook for the year ahead

Good news for buy-to-let investors, Zoopla forecasts rents to continue to climb throughout 2022 – albeit at a slower pace than in the last 12 months. Although seasonal trends and affordability constraints are likely to see tenants stay put in their current housing, the record level of demand for rental property will ease in 2022.
The rate of rental growth is set to reach 4.5% across the UK, excluding London, and 3.5% in London. For those investing in buy-to-let property, stable and rising rents remain one of the most attractive reasons to enter the UK’s real estate market, providing steady yields year after year.
Investors looking at the broader property market will also be interested in rising property values across the UK, with the house prices in January 20229.7% higher when compared to the previous year, according to the Halifax House Price Index.
With rising rental values and the ability for property owners to secure increasing levels of equity, the outlook for property investors remains strong.

Invest in property in Hull

Despite its strong market fundamentals, Hull has flown under the radar of investors as a hotspot for property investment. Few regional locations compete when it comes to lower entry-level properties with excellent capital growth potential.

If you wish to invest in property in Hull, follow this link to find out about our city centre apartments for sale or contact Surrenden Invest.

Average annual UK rental growth up by 8.3% in 2021

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Those looking for buy-to-let investment opportunities in the UK will be interested in the latest Rental Market report released by Zoopla, which has recapped the performance of the rental market over the last 12 months.
According to the index, the average annual rental growth across the UK reached 8.3% in 2021. A sharp rise in demand in Q4 saw rents on new lettings increase by 3.7%, with city centres experiencing the highest climbs due to a renewed interest for centralised properties from renters. Compared to average rents before the pandemic, rents have increased by £62 per calendar month (PCM), with the average cost of renting across the UK now standing at £969 PCM.
Commenting on the report, Gráinne Gilmore, Head of Research at Zoopla, said: “Rental demand has risen strongly amid increased activity in city centres, but supply is still constrained, leading to the fastest growth in rents in Q4 than at any time over the last 13 years.” With demand for rental at a record-high, the experts at Surrenden Invest have highlighted their main findings from Zoopla’s index to help investors and landlords make the most out of their rental property investments in 2022.
For the latest breakdown of the best regional hotspots for buy-to-let opportunities, visit the City Guide section of our website, where you can download our new range of insights and reports.

+8.3%

UK annual change in rents

+10.3%

London annual change in rents

+7.5%

UK annual change in rents (excluding London)

+76%

UK rental demand increase in January

London leads the way for rental growth

Over the course of last year, London witnessed the highest annual rental growth, with the cost of new lettings increasing by 10.3%.
Despite annual headline figures, significant falls across 2021 caused by the pandemic mean that average rental costs increased by £18 PCM since March 2020. Data from Zoopla shows that rents increased in London from an average of £1,622 PCM in March 2020 to £1,640 PCM in December 2021.
An increase in the number of people returning to the workplaces has seen annual rents increase in inner cities like London, outpacing the growth rate in commuter zones for the first time since the pandemic. However, the rising cost of renting a property will put off many renters who previously relocated and have adjusted to more affordable living costs outside of the capital.
Due to the higher cost of buying property in London, buy-to-let investors are likely to find lower entry-level and high yielding opportunities in one of Surrenden Invest’s post-pandemic commuter belt property hotspots.

Demand for city centre rental property surges

The performance of regional cities continues to paint a positive picture for property investors, with demand for centrally located rental homes surging following the ease in Covid-19 restrictions.
Zoopla reported rents increased in every region and country in the UK in 2021. Excluding London, the average rental cost was up by 7.5% across the course of the year. With a sharp bounce-back in demand for city-centre rental accommodation due to the reopening of offices, the return of university students, and most global travel restrictions uplifted, pent-up demand has caused a rapid rise in rental costs.
According to the report, demand for rental property increased by 76% in January compared to tenant interest during similar periods between 2018 and 2021. Regional cities with the highest recorded rental climbs include economic hubs, with Surrenden Invest’s selection of 2022 property hotspots experiencing impressive growth.

Spotlight on top regional performers

Those keeping an eye on regional trends are likely to be encouraged by their performance of the UK’s rental market as a whole, with popular investment locations including Yorkshire and the Humber (+8.5%), West Midlands (+8.6%), and the North West (+8%) all posting a more robust growth than the UK average excluding London (+7.5%).
Delving deeper into the performance of individual cities, annual changes in rents were particularly strong in Manchester (+9.5) and Birmingham (9.4%), emphasising the demand for housing in critical economic hubs that boast good employment prospects. Popular university cities including Nottingham (+10.6%), Sheffield (+6.6%), Newcastle (+6.3%), and Liverpool (+6%) also reported positive rental growth year-on-year.
Commenting on the latest Zoopla Rental Index, Jonathan Stephens, Director of Surrenden Invest, said:
“It is safe to say that the UK’s property market experienced a shift in demand throughout the pandemic. The freedom of working from home saw a change in what tenants wanted and needed from their living space – namely, square footage and green space. Although this way of life will continue to suit some people, many returning to the workplace are gearing up to re-join the hustle and bustle of city-centre living.
“When it comes to rental yields and high occupancy rates, it is clear that city-centre property will continue to attract tenants who have essentially put their lives on hold during the pandemic. Investors should therefore consider the significance of the location of their next rental property investment and affordability levels in 2022 to secure high occupancy levels.”
If deciding on a location for your next rental property investment is holding you back, contact the experts at Surrenden Invest who will help you determine the best option for your circumstances.

Is it time for landlords to increase rents?

As demand for rental property continues to outstrip the number of available options on the market, rents are likely to remain buoyant due to competition from private tenants. For landlords with tenants already in place, Zoopla has advised that despite the New Year bounce-back from renters, the demand peak has begun to ease in February, indicating that less competition will reduce the scale of rental growth across the next 12 months.
Affordability levels also remain a concern for renters so, if you’re considering increasing the monthly price of your rental property, it is worth researching the local market before re-listing. Instead, savvy landlords may wish to renegotiate longer tenancies with existing tenants in a bid to secure higher occupancy levels.

Outlook for the year ahead

Good news for buy-to-let investors, Zoopla forecasts rents to continue to climb throughout 2022 – albeit at a slower pace than in the last 12 months. Although seasonal trends and affordability constraints are likely to see tenants stay put in their current housing, the record level of demand for rental property will ease in 2022.
The rate of rental growth is set to reach 4.5% across the UK, excluding London, and 3.5% in London. For those investing in buy-to-let property, stable and rising rents remain one of the most attractive reasons to enter the UK’s real estate market, providing steady yields year after year.
Investors looking at the broader property market will also be interested in rising property values across the UK, with the house prices in January 20229.7% higher when compared to the previous year, according to the Halifax House Price Index.
With rising rental values and the ability for property owners to secure increasing levels of equity, the outlook for property investors remains strong.

If you are considering expanding your property portfolio in 2022, contact Surrenden Invest to discuss your requirements. Alternatively, get the latest property market news and reports sent straight to your inbox by signing up for our monthly newsletter.

Spotlight on Redhill: Why now is the time to invest

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The beginning of a new year is a great time to reassess your property portfolio’s performance and start researching locations for potential investments for the upcoming 12 months.
While demand for property investment opportunities remains, investors’ strategies have changed in response to the Covid-19 pandemic. Namely, the variety of options now on offer in emerging property hotspots following a shift in buyers and renters’ living habits and lifestyle changes.
As a result, buy-to-let investors have been looking beyond the traditional locations for rental properties and exploring up-and-coming markets that offer strong growth over the coming years.
London has been the destination of choice for many property investors in the past. But, while sub-sectors of the capital’s real estate market have proven profitable over the last two years, buy-to-let investors have increasingly recognised the effect of the pandemic on the lives of tenants, leading landlords to destinations like Redhill in London’s commuter belt.

London’s second-best commuter town

The leafy Surrey town of Redhill was recently named London’s second-best commuter town by property portal YOPA, only beaten by St Albans in Hertfordshire. Boasting a frequent and fast direct train into London – with a journey time of around 30 minutes – and the average property price of £416,944, Redhill has emerged as a popular town for those looking to relocate outside of the capital.
For buyers looking towards London’s commuter belt for their next rental property purchase, it should come as no surprise that housing values in Redhill have increased by 4% over the last 12 months and by 10% since 2018. Value for money is a driving factor behind Redhill’s rise in popularity, offering both buyers and renters a lower entry-level onto the property market.
Interestingly, for those comparing the capital required to invest in Redhill, the average cost of a property is significantly lower than comparable commuter belt hotspots. For example, the average price of a property in neighbouring hotspot Woking is £540,887, £618,676 in St Albans and £711,681 in London’s most established commutable town Sevenoaks.
Redhill offers buy-to-let investors considering adding a commuter belt property to their portfolio a significantly lower level of investment. With housing values in the South East set to rise by 10.4% by 2026, a rental property in Redhill has the potential to increase significantly in value.

£416,944

Average house prices in Redhill are £416,944, a popular town for those looking to relocate outside of the capital

10.0%

Housing values in Redhill have increased by 4% over the last 12 months and by 10% since 2018

£711,681

Price of a property in neighbouring hotspots includes Sevenoaks – £711,681 which is London’s most established commutable town

10.4%

Housing values in the South East set to rise by 10.4% by 2026, a rental property in Redhill has the potential to increase significantly in value

An established location in its own right

Redhill’s impressive connectivity to London and the surrounding areas has turned it into a standout location for buyers and renters. Those considering the town for an investment property will be pleased to hear that it is not just its ability to offer its residents a quick getaway that has helped to put Redhill on the map.

Excellent employment prospects

Redhill’s prime location and excellent transport links have helped it emerge as a prominent business hub in the South East and is home to many multinational companies, including SES Water, Santander Consumer Finance, AXA breakdown assistance, Travelers Insurance, and Aon.
It is also a short, 15-minute drive from Gatwick Airport – one of the country’s largest airports and most significant employers in the area.
Property investors should be encouraged by the impressive employment prospects available in the town, and it is unique position between two of the biggest employment hubs in the South East. As proven time after time, areas that boast excellent job opportunities are most likely to see demand for housing remain strong for the foreseeable future.

Significant regeneration projects

Commuter belt towns like Redhill, which are undergoing rapid regeneration but remain affordable, have emerged as favourites in the eyes of investors, and the reasons for its rising popularity are clear. With values significantly below the capital but rental returns and capital value forecasts markedly stronger, buy-to-let investors have much to gain by expanding their property portfolio to include a rental property in Redhill.
Investment in regeneration projects like Redhill’s£40 million development in Marketfield Way, which comprises a multi-screen cinema and commercial space for restaurants and shops, will revitalise the town centre and enhance its popularity over the long term.
Property investors should also consider investments in infrastructure and connectivity, like the £8.8 million funding boost for improvements to facilities and local services in the wider Reigate & Banstead Borough through the Community Infrastructure Levy (CIL). The investment will deliver several enhancements across the borough and improve the lives of those living in the area in the years to come.

What’s driving rental demand outside of London?

Since the first lockdown in March 2020, an increasing number of people have left London in favour of spacious and more affordable accommodation outside of the capital. As flexible working became the new norm, city workers in their droves swapped their everyday commute to only travelling to work a few days a week. As England’s lockdown restrictions ease and people are asked to return to their offices, the cost of renting in London has rapidly increased. According to data released by Rightmove, London rents are now higher than they were before the pandemic.
Demand remains a sticking point for rising rental costs in the capital, with tenant demand up 32% compared to the same time last year whilst the amount of available stock is 51% lower. Renting in the South East – just outside of the capital – is now 9.8% higher than last year, highlighting the continued demand for housing within an easy commute into the capital.
Rightmove forecasts a 5% rise in rents throughout 2022 as the imbalance between supply and demand continues. For those living in a commutable town outside of London, affordability remains a factor preventing them from moving back to the capital. However, with rental costs rapidly rising, many city workers remain happy to swap a longer commute favouring a better quality of life.
Buy-to-let investors are in an ideal position to capitalise on the demand from this vast pool of renters by offering high-quality rental property. Our latest development, Warwick House in Redhill town centre is a prime example of the type of property investors should consider.

Warwick House, Redhill

When selecting a buy-to-let property investment for our clients, Surrenden Invest conducts a strict due diligence process which includes the points outlined in this feature. Warwick House is an outstanding example of a buy-to-let opportunity in London’s commuter belt. The development contains a selection of 61 studio, one and two-bedroom apartments that will be completed to an exceptionally high standard to appeal to young professionals and city workers.
Housed within a private gated community, Warwick House is located in Redhill’s town centre and is a short walk from the train station, which offers city workers a direct route into London. This outstanding new development ticks all the right boxes for investors and renters alike and will provide the town’s rental market with a luxurious option for prospective tenants.

Available through Surrenden Invest, Warwick House is a fully managed rental property investment in Redhill. For more information about the development, request the brochure today.

UK interest rate rise: What it means for property investors

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In December, the Bank of England (BoE) announced a rise in interest rates for the first time in over three years to combat the increasing cost of living caused by inflation. The BoE raised the base rate to 0.25% from a historic low of 0.1%.
With inflation at its highest rate in a decade at 5.1%, BoE governor Andrew Bailey said that action needed to take place to tackle ‘inflationary pressures’ building up in the economy. The BoE’s decision to increase mortgage rates will increase mortgage costs for some homeowners and property investors.
However, in reality, despite the rise in the cost of borrowing, those who wish to fund their property investment with a mortgage should note that rates remain at an exceptionally low rate.
In this feature, Surrenden Invest looks at the history of interest rates in the UK and what the latest rise means for investors.

What is the current interest rate in the UK?

The UK interest rate has been increased to 0.25% to combat a surge in inflation. Those keeping a close eye on the cost of borrowing will note that the Bank of England’s latest increase remains below interest rates before the first lockdown in 2020.
In response to the coronavirus outbreak back in March 2020, the Bank of England confirmed an emergency cut in the benchmark interest rate, from 0.75% to 0.25%, to lower borrowing costs to stimulate the economy and protect it from the worst effects of the health crisis.
With a record-low emergency interest rate of 0.1% introduced during uncertain times, it was inevitable that the central bank would introduce incremental rises. Those looking to fund their property investment with a buy to let mortgage remain in a favourable position to borrow money at a low rate.

16.2%

house values at the start of the 2008 recession plummeted by an average of 16.2% across 12 months

£209,000

2009-2016, interest rates remained at 0.5%. During this time, average house prices went from £158,004 in May 2009 to £209,000 in April 2016.

0.25%

Following the UK’s decision to leave the EU, the Bank of England cut interest rates to 0.25% from 0.5%

0.75%

Two gradual increases were introduced between August 2016 and November 2017, bringing it to 0.75% at the start of 2020

UK interest rates history

Over the last ten years, one of the most encouraging aspects of the UK property market has been the low interest rate environment for borrowers. Following the financial downturn and recession of 2008, interest rates have been historically low since the Bank of England’s decision to significantly lower the base rate from 5.75% in July 2007 to 0.5% by April 2009.
According to Halifax figures, house values at the start of the 2008 recession plummeted by an average of 16.2% across 12 months. With people losing confidence in the housing market, this moment in time marked a monumental change to the future of the UK’s private rental sector.
In 2008, the appeal of buy to let property increased, as investors started to see the value in investing in rental property by taking advantage of the low cost of borrowing. Between 2009 and 2016, interest rates remained at 0.5%. During this time, average house prices increased from £158,004 in May 2009 to £209,000 in April 2016.
Following the UK’s decision to leave the EU, the Bank of England cut interest rates to 0.25% from 0.5%, warning high-street lenders to pass on cheaper borrowing costs to customers in a bid to prevent a post-Brexit recession. At the time, the rate was considered an ‘all-time low’. As the UK navigated its way through Brexit negotiations, two gradual increases were introduced between August 2016 and November 2017, bringing it to 0.75% at the start of 2020.
On March 11th 2020, the Bank of England responded to the pandemic by cutting interest rates to 0.1%, which remained in place until December 2021, when rates increased to 0.25%. Historically speaking, borrowing remains cheap for those buying or investing in a property in the UK. While there is inevitably clear scope for interest rates to increase in the future, buy to let mortgage borrowers will still be able to access excellent deals.

Rising interest rates effect on real estate

Given the competitively low rates still available, landlords and investors with a portfolio of properties that have taken on a lot of mortgage debt are likely to witness a relatively small climb in repayments. Looking at the property sector, investors who wish to secure a property with a buy to let mortgage are in a fantastic position to benefit from a low cost of borrowing and a strong 5-year market forecast.
According to the latest Savills outlook, average UK property values stand to climb by 13.1%% over the next five years. For buyers looking for the best capital gains, housing in regional property hotspots in the North of England and London’s commuter belt are set to see the most significant uplift in values. Investors looking to invest in property in 2022 should be reassured by rising property values and lender competition will inevitably keep levels down.

Commenting on the interest rate rise, Kevin Roberts, director of Legal and General Mortgage Club, said:

“People tend to fear higher interest rates as it makes borrowing more expensive. But we ought to bear in mind that this is a small increase and rates are not going back to anything like ‘normal’ levels any time soon.”

Are interest rates higher on investment property?

When it comes to investing in property with a mortgage, property investors should be aware that interest rates could rise in the future, albeit at a slow pace. Buy to let (BTL) mortgages are designed for property investors and landlords who want to buy a property with the sole purpose to rent it out. Although most of the regulations around BTL mortgages are similar to more traditional mortgage products, there are some noticeable differences.
The cost of borrowing is one of the critical differences for BTL investors. With interest rates generally higher on investment property, borrowers should shop around to get the best deal. Fees and minimum deposits also tend to be higher for a BTL mortgage.
As most buy to let mortgages tend to be on an interest-only basis, investors should also consider whether they wish to enter an interest-only or a repayment model basis. For more information about the mortgage options available to you, contact Surrenden Invest, and a member of our team will be happy to recommend a trusted mortgage broker.
In the meantime, to help determine how much you could borrow to fund your next buy to let property purchase, this mortgage calculator will do the hard work for you.

Will interest rates go up in 2022?

Over the last ten years, UK interest rates have remained at record-low levels, with rates remaining below the 1% since 2009. For those planning ahead, most forecasts assume that the Bank of England will raise rates at a slow and steady pace.
Savills expects that throughout its 5-year house price forecast, interest rates will reach 1.5% at the end of 2026 before plateauing at 1.75% at the end of 2027. Given that the BoE raised rates at the end of 2021 to 0.5%, should interest rates go up in 2022, they likely won’t increase past the 0.75% rate that was in place before the beginning of the pandemic
Investors who act quickly will see the most benefits from the low rates. With fixed-rate mortgage options available, buyers could lock in a low rate for two to five years (seek independent advice to determine if this is the right strategy for you).
Ultimately, property located in established markets like the UK is viewed by many as a ‘safe haven’ asset. Despite interest rate rises, the strong appeal of rising rents and capital gains makes buy to let investment an opportunity that is certainly worth paying attention to.

For more information about investing in property in 2022, contact the experts at Surrenden Invest to discuss your requirements and to view our current availability.

History of the UK’s Buy to Let Property Market

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September 2021 marked 25 years since the arrival of buy to let mortgages. In that time, the UK’s property market has proved its resilience, weathering the storm through two recessions, a global financial crisis, the withdrawal from the European Union, and a pandemic. Throughout this feature, Surrenden Invest looks back at what has shaped the UK’s private rental sector to make it into the thriving entity it is today, and investigates what valuable lessons investors can learn from its growth.

History of UK buy to let

The UK’s buy to let (BTL) sector has come a long way in the past 25 years, growing from a relatively small, niche market into a multi-faceted, lucrative area of the property sector. The first buy to let mortgage products officially launched on September 24, 1996, when the Association of Residential Landlords (ARLA) developed a mortgage product tailored to landlords with a small group of lenders.
This groundwork facilitated much-needed investment into the rental property market in response to rising demand from tenants and an overall shortage of homes across the nation. Since then, buy to let has become a mainstream consideration for buyers and is generally accepted as one of the best performing asset classes. The tangible nature of property and its track record of delivering returns that consistently outpaced stocks and shares have seen its popularity grow considerably.
Today, the widespread availability of BTL mortgage products has seen the number of landlords surge to 2.65 million in the private sector, owning a staggering total of over £1 trillion worth of homes across the UK. But how did buy to let manage to position itself so firmly in the marketplace? And is there still room for property investors to capitalise on the sector?

The 1990s: UK homeownership peak

Despite the availability of BTL mortgage products emerging in the late 90s, the story of the UK’s buy to let sector seemly begins around 20 years earlier.
Following the election of Margaret Thatcher in 1979, major changes took place. At the time, only 55% of Brits owned the home they lived in, yet this figure was about to witness a stark increase, with the introduction of the Right to Buy (RTB) policy introduced under the Housing Act 1980.
By 1995, the Right to Buy policy saw the public sector to private ownership side of the market rapidly shift, with almost 2.1 million homes transferred through the scheme. This, coupled with 100% mortgages, which granted more people than ever before the possibility to access the market, saw the nation witnesses a massive boost in ownership compared to 15 years before.
On top of this, the overall level of new-build housing has dropped since the 1980s. Data from the Office for National Statistics (ONS) showed that house building declined by 44% between 1980 and 2014. This trend continues to be a problem despite the government’s continued promise to deliver 300,000 new homes per year to ease supply issues.
Despite the early 90s recession slowing down the rate of homes sold under the RTB scheme, the 1990s became one of the UK’s strongest decades for homeownership levels. By the turn of the millennium, homeownership levels had hit 70%. At the same time, however, the private rented sector started to gain traction. The introduction of dedicated buy-to-let mortgages in 1996 naturally saw investment levels rise.

Commenting on the introduction of BTL mortgages to the market, John Heron, the former director of mortgages at Paragon Bank, said:

“Borrowers could get finance at up to 75% of the value of the property and affordability would be assessed on the income the property generated and well as the landlords wider financial circumstances. In addition, landlords would be able to make the most efficient use of capital available and maximise their return due to the option to take out interest-only mortgages.”

£181,000

By 2007, rising prices year on year led to the average property price reaching a record high

£25.8bn

Lending fell from £45.7 billion in 2007 to £28.5 billion in 2008

£37.9bn

Market rebounded quickly, rising from £9.6 billion in 2010 to £37.9 billion in 2015

22.0%

The nation’s private rental sector now accounting for 22% of all homes

The global financial crisis

The turn of the millennium is often overlooked for the part it played in shaping today’s property market. Overshadowed by the global financial crisis, homeownership levels started to decline across the UK around 2002.
Data released by the Resolution Foundation helps paint a clearer picture of the market back then. With high house prices, low wage growth and an ongoing lack of available homes, the number of people who owned their own homes started to dwindle, and, somewhat surprisingly, it has not reversed since.
Similar to today’s market, the early 00s saw most people priced out of the market, and by 2007, rising prices year on year led to the average property price reaching a record high of £181,000 at the time. Naturally, with most people unable to get their foot on the proverbial housing ladder, estimates at the time suggest it was around 25% to 40% cheaper to rent than buy, which meant that many people decided to go with this option.
Following the global financial crisis in 2007, the financial downturn and recession of 2008 proved disastrous for the property market, with the value of property and access to lending dropping overnight. For the buy to let mortgage market, approved loans almost halved between 2008 and 2010, with lending falling from £45.7 billion in 2007 to £28.5 billion in 2008, and just £8.6 billion in 2009.
However, the market rebounded quickly, rising from £9.6 billion in 2010 to £37.9 billion in 2015. BTL investment rocketed in the space of just five years, with these peak years forever changing the landscape of the private rented sector. The number of privately rented homes peaked, rising from three million to more than just five million over a short period of time.
Investment levels into the UK’s buy to let property market continues to grow, with the nation’s private rental sector now accounting for 22% of all homes. For the first time in recorded history, the number of private sector tenants is higher than public housing, with just two-thirds of people now owning their own property – the lowest level witnessed since the 1980s.

Today’s UK buy to let market

For property investors and landlords, tenant demand is key to the success of BTL investments. In today’s market, affordability issues and a rise in remote working among Millennials and Gen Z has created a large pool of tenants who do not aspire to own their own home.
Good news for investors, the so-called ‘generation rent’ refers to younger people who opt to rent over buying for a variety of reasons that include location freedom and the desire to work remotely from anywhere in the world. What’s more, rental market allows young professionals to rent city centre properties at a fraction of the cost of buying one, offering them a better work/life balance.
Property investors are presented with an opportunity to invest in new-build housing specifically designed to meet the needs of this large demographic of renters.
Fully managed buy to let property investments like the apartments available through Surrenden Invest have proved popular for investors and renters alike, offering buyers reliable rental returns from properties located in areas with high demand from tenants. To view our latest range of buy to let opportunities, click here.
Aside from Brexit and the pandemic, just like in the 1980s, changes introduced by the government to increase homeownership levels have been one of the biggest challenges that the UK’s property market has faced. A tide of changes has been phased in over the last five years in a bid to improve homeownership levels, with landlords and investors bearing the brunt of policy changes.
The introduction of a 3% levy on Stamp Duty on BTL property, changes to mortgage interest tax relief, more stringent rent background checks, and abolishing estate agency fees have all seen the market shift in recent years. However, despite the introduction of changes, the demand for buy to let remains evidently clear.
With over five million people living in private sector homes owned by more than two million investors across the globe, the UK’s buy to let sector certainly still has room to grow. And for those looking for further evidence of the longevity of the BTL market potential gains it has to offer, it is estimated that property investments purchased back in 1996 have risen by 1,400%.
Get the latest UK property news delivered straight to your inbox by signing up for Surrenden Invest’s monthly newsletter. You will gain valuable insights into trends, plus you will be able to preview new launches before they enter the market.

For more information about buy to let property investment, contact Surrenden Invest today.