Landlords See Annual Rent Growth Double
Landlords around the UK have seen the annual growth for private rents nearly doubling, with rising demand and falling rental supply leading to the rise.
The findings from Zoopla reveal that there's been an 8% rise in rental demand over the past year - and there's been a 4% fall in homes for rent Ė which helped rents to rise by 2.6% in 2019. The year before, rents grew by 1.4%.
Zoopla's research director, Richard Donnell, said: "A lack of real wage growth and housing supply is behind the average rent increase seen across the country in 2019.
"New investment from landlords has dropped since tax changes were introduced in 2016 and this has been most keenly felt in southern England where property yields are the lowest and property values are highest.
'Why rents are growing in the face of increasing rental demand'
"This is creating scarcity and helps explain why rents are growing in the face of increasing rental demand and levels of employment continue to rise growth."
He added that the positive news for tenants is that rent growth is running below the growth level for average earnings.
Zoopla is now predicting that rents will rise by 3.5% this year as the lack of rental home supply will promote faster rent rises.
The property portal points to Nottingham as seeing the largest rent rises at 5.8%, followed by York, Bristol and in Aberdeen, landlords saw rents drop by 2.9%.
Landlords look to expand in the North West
Meanwhile, it's been revealed that one of the most popular areas in 2020 for landlords to expand their portfolio is going to be the North West.
According to Precise Mortgages, they say that 22% of all UK landlords are planning to buy property in the region.
The next most popular locations for landlord investment are the South East and then Yorkshire and the Humber.
Landlords looking to expand their portfolio
Of those landlords looking to expand their portfolio, 18% will use equity from their current properties while 68% are looking to use a buy to let mortgage.
The firm's managing director, Alan Cleary, said: "The growing professionalisation of the BTL sector means landlords are becoming selective as to where they buy properties and how they fund purchases.
"The recent buy to let market rate cuts highlight the opportunities for increasing profitability and portfolios and this is underlined by the need for expert advice, particularly among landlords with a bigger portfolio."