Rental market forecasts can be extremely useful for new and existing landlords. In this blog, we’re answering the question, how accurate have rental market forecasts been in 2024?
The property market experienced many changes during and after the pandemic. Following this, there has also been a cost of living crisis, which has had an impact. This has been particularly tricky for landlords to deal with as they decide on the best steps for their investments.
Luckily, over the last few years, there has been a huge increase in rental demand, this has made being a landlord a very positive experience. Let’s get into what was expected in 2024.
What did we expect from 2024?
House prices
In 2023, average house prices fell and it was very much expected that this would continue into 2024. This increased the competition for investors looking to purchase new properties.
The drops were around 5 to 10%, which was actually much less than what was predicted by experts. In 2024, it was expected that average house prices would continue to decline, but this has not actually been the case.
Midway through the year, the forecasts changed, with experts predicting rises of between 2 and 4%.
Rental properties
Tenant demand is continuing to rise, with many properties only being available for a short time before they become tenanted. This is great news for landlords as it means they can access a steady flow of tenants and a consistent income.
Being a landlord can be made much easier with an excellent property management company on hand. We offer a wide range of services to help you get the most out of your investment.
Monthly rent increases
Monthly rental costs have continued to rise in line with other inflation. In England, rent growth has been at around 8.6%. This figure is much higher than the predicted rent growth which was between 4 and 5%. Average rent costs vary depending on the location of your property. Rising rents will continue in line with wage growth in the private rented sector.
Locations of rental homes
London has long been a popular spot for buy-to-let investments, however other areas of the UK are now becoming more appealing. The North West in particular is experiencing great rental yields.
The North West offers many opportunities for people of all ages with many universities and fantastic career opportunities. Many landlords are choosing to purchase homes in the area to rent out.
How accurate were the forecasts?
Overall, the rental market forecasts for 2024 have been reasonably accurate. The figures have been fairly positive for landlords.
What can we expect from 2025?
In 2025, we can expect to see rental growth increasing at a similar rate to 2024. This is likely to start slowing down over the next few years.
House prices are expected to rise, but not until mid 2025. This means that now is a great time to purchase a property to use as a buy-to-let. It also means that the property is likely to be worth much more in a few years time.
Rental property demand is also expected to continue at a higher than average rate. As we mentioned previously, this is great for landlords.
Landlords need to continue looking into mortgage interest rates, the housing market, trends for rent increases and new regulations in the private rental sector.
Are you looking for a property management company to help you on your journey as a landlord? Whether you’re a new landlord or you’ve done it for years, our friendly team is on hand to help with every aspect. Contact us today to see how we can help.
