Easing of lockdown prompts surge in rental demand

It was already looking likely anyway, but it appears that our prediction that rental demand would surge following the easing of restrictions over the industry following the Coronavirus pandemic is materialising.

Easing of lockdown prompts surge in rental demand

Perhaps not unexpectedly, but there are perhaps some unforeseen circumstances that are also driving the demand. In the same way that the Christmas period, and prolonged time cooped up together often translates into high demand in the new year, it may well the be the case that being forced to stay home for months has had a similar effect, despite the seasonal weather.

That being said, for those without a garden, or even a good garden, this has more than likely had a similar effect in pushing tenants and homeowners into action to upgrade, especially those with children.

Most estate agents will now be able to testify that they’ve experienced their busiest periods for some years after the lifting of lockdown restrictions, and this appears to be reflective of a wider drive in demand across the entire property industry.

Break ups and job changes

According to data reported by The BBC it appears that one potential explanation is that during lockdown, as with Christmas, lots of break ups have happened and separated couples are now keen to find new accommodation.

Further to this lots of people have had to seek new work after the tectonic shift in the economy following the near total shut down from March through until recently.

Since restrictions on estate agents were lifted on 13th May, demand for rental homes has increased at a quicker rate than the sales market, according to Rightmove.

There are also numerous news outlets reporting that estate agents, since opening, have been ‘crazy busy’, like ‘a champagne cork coming out’ and ‘back in business’.

It would seem that this also isn’t a flash in the pan, with significant demand appearing as though it may remain stable throughout the summer, however, the same BBC article also reports that demand is currently far outstripping supply.

Rental and yield growth

All this is highly likely, as this data acknowledges, to mean significant upward pressure on rental growth as well as yields on rental property.

For buy-to-let landlords this spells excellent news after what has been not just been a difficult few months, but a testing time over the past few years with changes to tax laws and government legislation changing the industry significantly.

As always though, UK property has remained robust throughout, with strong returns and stable demand.

In the end, of course, even a global pandemic was always unlikely to drive demand for rental property, if not home buyers.

The fundamentals of the industry remain unchanged, and economic uncertainty of this nature could, in the end, actually end up having the opposite effect and increase demand as people put more focus on the features and space their home affords them in uncertain times.

Indeed, the population are under significant pressure and this adds to uncertainty of circumstances and this often has the side effect of increasing overall demand for rental property. Regardless, this will make for an interesting year.

Looking for a rental property? Head over to our Nationwide lettings company Intus Lettings and take a look at their available properties.

Leeds Guide vertical - April 2019

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