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Oxfordshire PRS Snapshot

Oxfordshire PRS Snapshot

Two reports published today and yesterday give completely different picture of what is happening to residential rents in the UK. Whilst both reports see regional differences in what is happening, the reality here in Oxford has little in common with either picture.

According to Aneisha Beveridge, principle research officer at Hamptons (which as part of Countrywide probably has access to their data too) rents in the UK have risen by 8.5% in the last 12 months, and the South East saw the biggest rises at over 15%! In another report, with data from the Office of National Statistics, the National Landlords Association suggest that rent rises in England over the last year have failed to keep up with inflation (1.1%) with the East and West Midlands seeing the highest rises at 2.4%.

Here in Oxford we have seen a different picture, demand for flats (one and two beds) has been reduced over the past 18 months, as reduction in overseas searchers and increased prioritisation of garden space WFH office space encouraged tenants to upsize and created an oversupply resulting in rents staying stable and only seeing a 3-4% annual increase.

HMOs, both for professional sharers and for students have continued to perform well despite many of them sitting empty as University’s packed up and moved teaching online. The majority of HMO property in Oxford is let nearly a year before occupation, so by the first lock down in March 2020 most of the stock was already let through to summer 2021. Rents have seen an average of 4-5% uplift during this time and the sector continues to deliver returns despite increased accommodation offerings from the University’s. 

Driven by families moving out of London, large homes and professional properties in “leafy” Oxford and surrounding villages such as Sandford, Beckley, Wheatley and Thame have seen the most impressive gains with demand greatly outstripping supply, in many areas resulting in near 10% growth in achievable rents over the 12 month period.

Both reports agree on one thing……. With more landlords leaving the market nationally due to continued Tax and legislative obstacles and a lack of incentive for build to rent in rural areas continued rent increases are inevitable. 

In every market there are opportunities…….. It may well be that yields in rural areas will finally catch up, and fundamental shifts in the way people are choosing to live are already impacting Landlord behaviours. Research from Paragon indicate a really active buy to let market at the moment with over half of Brokers citing strong or very strong demand from investors; Moray Hulme, Paragon Mortgages director of sales, said: “These figures suggest that the strong levels of buy-to-let business witnessed over the last six to nine months wasn’t just as a result of the stamp duty stimulus, but down to more fundamental shifts in where and how people want to live.

“We still expect to see business levels moderate as the stamp duty holiday ends but landlords are seeing plenty of opportunities to expand their portfolios to meet excellent levels of tenant demand and changes in the type of property people now want to rent.

 

“There has certainly been a growth in tenant demand for family homes, for example, and landlords are reacting accordingly.” 

We see opportunities for investors in Haddenham, Thame and even in Winslow where the East West rail link will make access to Oxford fast and frequent. For more information and advice call David on 01865722722.