Outlook 2022

Happy New Year and welcome to 2022. We hope you all enjoyed your Christmas break and managed to steer clear of the latest iteration of COVID-10, the ubiquitous Omicron!

What will 2022 hold, we wonder?

Well, it won’t quite be an end to the pandemic just yet. I think we all hoped that 2021 would see it off, but it turns out it’s a marathon not a sprint, and we have to prepare ourselves for a longer haul. But hope is in the air with the strain becoming less impactful and perhaps we’ll have a ‘normal’ Christmas next year and life will steadily improve along the way.

It’s always good to reset your compass and make a fresh start with a positive outlook.

What’s going on in the Property market?

This is always good question. Property is a resilient sector in the UK and its performance is a strong indicator of what is on the horizon. All reports indicate continued growth for the market driven by:

• the ongoing demand for more housing across the board
• consistent steady increase in property prices throughout 2021
• tenants returning to the office requiring urban housing
• increase in travel to the capital from high-net-worth individuals

Tenants returning to the office has triggered strong rental growth in the UK’s largest urban centres

The property rental profile

Since home ownership in London comes at a premium, renting is still the best way for many young professionals to achieve the quality of lifestyle that they seek. In fact, statistics show that of millennials, (those born between 1980 and 1996), 40% were living in rental accommodation up to the age of thirty with a potential 30% remaining in rented housing for the duration of their lives. This scenario is not uncommon in other European cities, but is a step change for the UK, where the proverbial Englishman’s home is his castle.

The private rented sector is expected to rise by 4.5% nationally in 2022 according to Zoopla – a strong message for investors. Their UK Rental Market Report shows that average UK rents were up 4.6% in the year to October 2021, after climbing 3% in Q3 as demand soared in city centres.

Changes afoot

To stay on top of the market it’s wise for Landlords to keep an eye on changes to legislation, the green agenda and how that can impact upkeep on property, and also popular demands.

The obvious one is the Renters’ Reform Bill, though delayed by the pandemic it is still nonetheless on the agenda, with a white paper to be published in 2022 and implementation set for 2023.

The other one in everyone’s sightline is the change in Energy Efficiency standards. From 2025, the minimum standard will be increased to C for new tenancies. This will be extended to existing tenancies from 2028.

A new rental audience?

And finally, if you want to appeal to more tenants, then apparently you need to consider allowing pets. Since so many people acquired a four-legged friend during the lockdown, they now need to find homes to suit. Making sure you have the right insurance in place could open the door to a new rental audience.

So overall a bright picture and some good reasons to be cheerful. The outlook points to more stability in all property markets for 2022. Good news for everyone.

If you need advice and guidance around any of the above points, then please call our friendly team to discuss how MIH could help you gain the advantage in 2022.

Get in touch to find out how we can work together.

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