The next five years will see an interesting change in the Evesham property market. My recent research has concluded that the rent private tenants pay in Evesham will rise faster than Evesham property prices over the next five years, creating further issues for Evesham’s growing number of renters.
Over the last five years, property values in Evesham have risen by 28.2%, whilst rents have only risen by 7.5%.
Throughout the last few years, and compounded in 2016, tenant demand for rental properties continued to increase, whilst the media predict that some landlords expect to reduce their portfolios in the next couple of years. The obvious result being that Evesham tenants will have fewer properties to choose from, pushing rents higher. In fact, from my own experience and from talking to fellow property professionals around Evesham, there appears to be a significant shortage of new rental properties coming on to the Evesham lettings market.
Landlords have some intriguing challenges ahead of them in the coming years, most notably following the Conservatives’ move to change taxation rules for landlords. On top of that, an upcoming ban on letting agent fees is still to come into force (probably in 2018). When the same happened in Scotland in 2012, Scottish letting agents passed on those fees to their landlords, who in turn increased the rent they charged to their tenants.
I would suggest to Theresa May and Philip Hammond that they should be very careful about indicating both red and green lights at the same time to the private rented sector. They can’t expect the armies of small private landlords to continue to house around a fifth of the population whilst taxing the hell out of them. They didn’t invest in buy to let as a charitable endeavour to satisfy philanthropic urges. Something must give – and it is likely that it will be tenants who suffer significant rent rises over the coming years.
With the obvious challenges and uncertainty ahead, house price inflation is likely to be tempered over the coming five years in Evesham.
I predict that by 2022, the average rent in Evesham will rise to around £900 per month
These are interesting times. There is still money to be made in buy to let in Evesham, but the towns’ landlords will certainly need to be smarter and more savvy with their investments.
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