Being able to work from home meant many tenants quit urban areas for a new life in the suburbs or the countryside.
This, along with job losses, resulted in private rents in Britain’s cities falling by as much as 15 per cent over the past year and has been described by some as a “exodus” from the cities pushing up rental costs in rural areas.
Interestingly though, Zoopla also said most Londoners were looking for rental property within the city and the proportion of Londoners looking to stay in the city had risen compared with last year.
Despite the pandemic, the general demand for quality rental properties remains and this can only be positive news as we start to exit this nightmare, plus once people start to be re-employed in hospitality for example, this demand will only increase.
Strong rental market vital
It is clear landlords and the rental market in general will be vital to the recovery of our economy and go some way in helping to repair the economic damage to careers, lives and families, but I fear there are barriers still to overcome.
The much-reported cladding issue must be resolved and quickly, as not only has it affected landlords and their ability to either rent or sell the properties they have, but it has also affected many first-time buyers who are now unable to move.
I know the Royal Institution of Chartered Surveyors (RICS) is reviewing the EWS process, but greater support from government is needed.
There is also the prospect of changes in Capital Gains Tax which will affect property investors disproportionately and just the uncertainty of this looming may force some landlords out of the market.
On the flip side, overseas property buyers are still seeking opportunities to buy in the UK, owing to potential savings caused by the pandemic and a topic that I’ve avoided until now, Brexit.
Many investors are from the Middle East, Hong Kong and South Africa and for overseas investors, Brexit actually presents the potential for savings, as currency exchange rates fluctuate.
Also, Covid is providing opportunities such as discounted deals and so suddenly 2021 could be shaping up to be a big year, especially as the Bank of England Base Rate remains at the historic low of 0.1 per cent which is also favourable for overseas investors.
Important to an economic recovery is a healthy rental market with landlords willing to retain and improve the quality of their stock, along with some expanding their portfolios whether they are UK or overseas based.
Call me an optimist, but here’s to a much better year for all those involved in the buy-to-let sector.