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Rising Rents Produce Double Win for Investors

By Surrenden Invest | November 23, 2018

Rising Rents Produce Double Win for Investors

For the first time ever, asking rent prices outside of London have hit an average of more than £800 per month. The surprising figure was revealed by the latest Rightmove Rental Price Tracker, which showed that rents jumped by 0.8% in Q3 2018 – the largest increase at this time of year since 2015 – to reach an average of £802 per month. That’s an annual increase of 1.7%.

“Rising rents spells good news for investors, who can look forward to the potential for higher returns. However, that’s only half the story. The reason for the increase is a lack of available rental properties, which is in turn impacting on void periods – so this is a double win for the UK’s regional property investors.”

Jonathan Stephens, MD, Surrenden Invest

Available rental properties being snapped up quickly

Available rental properties have dropped by 8.7% in the past year. The drop is tied in with a 14% decrease in buy to let mortgage approvals, according to Rightmove. That means less choice for renters, which has led to the properties that are available being snapped up faster – as much as four days faster than this time last year in London!

Hadrian’s Tower Development in Newcastle

For property investors looking to add to their buy to let portfolio, this is an excellent opportunity to snap up new apartments with healthy yields; Hadrian’s Tower in Newcastle is a prime example of this. Not only does the development offer 5% interest during the construction period (with construction already underway), but it also provides a 7% NET rental assurance for five years.
Add to that the fact that Newcastle’s property prices have risen by 2.54% in the past year and by 23.46% in the past five years, and it’s easy to see why investors are so excited about regional developments like Hadrian’s Tower.

“With property prices falling in London, and low yields there as a result of the fact that prices have been inflated for so long, it’s regional cities that are at the heart of the investment action. Birmingham, Manchester, Liverpool and Newcastle are some of the most exciting urban hotspots, along with a number of key towns, such as Gateshead. These are the places to watch as we head into 2019.”

Jonathan Stephens, MD, Surrenden Invest

To keep up to date with investment news from across the UK, connect with the Surrenden Invest team on social media.

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