As the population growth continues throughout the UK, last week I took the opportunity to see how densely populated Tamesde is. Whilst the results were certainly interesting when stacked up across the rest of Greater Manchester, what exactly does the future have for Tameside’s population and rental sector based on projected growth figures?
The sheer strain on the housing market across the country at present can be attributed to a varying degree of factors:
A shortage in construction numbers? Certainly. Affordability, particularly for first-time buyers? Absolutely.
Perhaps one of the largest however is the demand in property, notably when it comes to demand outstripping the supply.
When it comes to getting on the property ladder, affordability has made it increasingly difficult for first-time buyers who in turn have navigated to the rental sector.
But with the Government’s ongoing assault on landlords in order to penalise a minority, many investors have exited the market; thus starting to cripple the rental stock and increasing competition between prospective tenants within the sector.
This in turn is beginning to drive rental figures up, as seen by the 1% change on average rental figures in Tameside over the last 12 months. My intuition tells me this is only just the beginning…
As the fifth most densely populated borough in Greater Manchester, population growth in Tameside is inevitably going to have an impact on both the competition in residential sales as well as tenants looking to rent a Tameside property.
But what do the projected figures look like into the future?
Based on my research last week, this means that there will be 9.3 people per acre living in the borough.
In order to ensure roofs over each and every single Tamesider’s head, home building has to continue strongly whilst there needs to be enough property investors continuing to invest in and let out their stock.
Tameside tenants will still require a vibrant and growing rental sector to deliver them housing options in a timely manner. As the population grows in Tameside and wider afield, any restriction to the supply of rental properties (brought about by poor returns for landlords and ongoing assaults from Parliament) cannot be in the long-term best interest of tenants. With this in mind, the Tameside landlords remaining persistent with their investments are likely to continue increasing the rental figures at the detriment to tenants, adding to the already ever present difficulty of homeownership.
In the grand scheme of things, rents only account on average for 29% of Tameside tenant’s disposable incomes (notice the word average), so the ability for most tenants to absorb a rent increase does exist. It is therefore in the best interest for landlords to analyse the area their investments are in; is the affordability in this area in line with your ability to raise rental figures without putting strain on the tenants?
Knowing how, when and where to inflate your rental figures for your investment properties is crucial to sustaining your long term returns, particularly in Tameside. If you are an investor in the borough or looking to invest in Tameside and want to know more about the long term vision for the borough’s property market, drop me a line on 07709 505442.