With the bad news that petrol prices are at a 3 year high, comes the positive effect that oil companies are doing well and as a result the local rental market is seeing a much needed boost.
We reported at the end of last year that oil companies were relocating large tranches of employees to the UK for January 2018. We didn’t know at the time how long this would last but they continue to come thick and fast and this looks set to continue well into the summer. The demand is mainly for family houses in North Surrey and Berkshire from £2500pcm to £10,000pcm. These are great tenancies which tend to last 2-5 years on average. We are doing strong business in this market but there is already beginning to be a shortage of the right homes.
This lack of letting stock coincides nicely with the ongoing soft sales market. Whilst many are holding out hope that house prices and the number of transactions will perk up in the forthcoming season, we think it is more realistic to expect this fragile period in the sales market to extend for probably another 2 years. At least until stamp duty is revised or Brexit settles down further. Developers particularly are realising the benefits of refinancing stock they can’t sell, locking into low interest rates (for now!) and renting out the houses instead. What will happen now we hope is that private sellers start to follow suit. We’ve seen this happen in countless difficult markets before and quite often these initial ‘reluctant landlords’ end up keeping the investment for the long term with no regrets and without looking back. It is a win-win for the new landlords and for tenants and helps to get some fluidity back in the market.
Being a company that specialises in Lettings we often worry that we will miss out on these prospective landlords because we’re not initially selling their home. However, what we find is that discerning investors prefer to consult and engage us as we can give them honest and realistic advice, independently of a sales department.
We’ve navigated our clients through many difficult markets and never has it a better time to have an experienced agent on your side.
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