According to Zoopla, rents are rising at their fastest rate for 3 years – and it’s not hard to understand why.
Shortening supply as landlords exit the market, increasing legislation putting pressure on income, and the Tenant Fee Ban are all key policy changes that we can see are having a direct impact on rents.
In Swansea, the average rental price increased by 6.49% in October. That’s the most impressive rent increase month-on-month in 2019 so far.
Rents on the Rise in Swansea
The average asking rent for Swansea this month is £817pcm. Last month, it was £764pcm. Zoopla puts the average rent for the UK at a whole as £876 pcm (up from £859pcm a year ago).
In January 2017, we reported that rents in Swansea had increased a record 11.4% the previous year. The average asking rent for a 2 bedroom house in 2016 was £632pcm. It’s now (in 2019) £721pcm – a 14.08% increase.
Despite the rent rises, Zoopla says the rental growth is half the level of earnings growth, which the ONS puts at 4% over the last three years, and that actual rental affordability is trending downwards.
Tenant Fee Ban vs Supply and Demand in Swansea
Rents were expected to rise this Autumn as agents adjusted their fee structures in line with the Tenant Fee Ban, and landlords sought to recover costs. However, this isn’t the only reason why rents are going up; supply and demand for quality rental accommodation is also a factor.
If you’ve been following our McCartan Rental Tracker, you’ll have seen that the number of 3, 4 and 5 bedroom properties have been decreasing for most of the year, while we’ve been finding more and more tenants have been calling to enquire about larger properties for their families. In our experience, demand has been outstripping supply while smaller properties go stale.
This month, the number of 3, 4 and 5 bedroom properties have all increased, so rents may stabilise over the next quarter as we head into the quieter season.
Landlords in Swansea who are feeling under financial pressure need to be looking at ways to add value to their properties (whilst make savings). Having a dedicated, proactive property management service like ours at McCartan will prove invaluable. Get in touch – we’d love to hear from you.