With 2020 and 2021 marked by significant shifts in the property market that affected private landlords in more ways than one, everyone’s now wondering what 2022 has in store for us.
Price drops or increases, changes in regulations applicable properties to let, our experienced Stratford estate agents are trying to make sense of things and predict what Stratford private landlords can expect in 2022.
Keep reading to learn more about our private landlord forecasts and contact our knowledgeable estate agents in Stratford at 0207 055 0441 to see how they can help you navigate the changes in the market and increase your ROI in 2022.
What you can find in this article:
- Property Prices Will Continue to Rise in 2022
- Rents Will Also Continue to Rise in 2022
- New Regulations for Private Landlords in 2022
Property Prices Will Continue to Rise in 2022
The effects of the pandemic seem to have left no stone unturned. Covid-related lockdowns and restrictions have definitely impacted the property market in the UK, with first-time buyers, sellers, and landlords each struggling with their own issues.
However, with restrictions now easing up, our Stratford estate agents are confident that the forecast for the property market and, in particular, the rental market in 2022 is more positive than for the past two years.
After being the hardest-hit, private landlords with smaller properties in the city are, at last, seeing the light at the end of the tunnel. In the past two years, as everyone was fleeing the city and looking for more suburban and spacious properties, their incomes clearly took a tumble.
But, this year, things seem to be returning to normal. Since the beginning of 2022, our estate agents in Stratford have seen a rise in interest from potential tenants for properties of all types and sizes within the city. They can confirm that, as professionals are returning to London to resume work or look for new job opportunities, demand for flats and other types of homes is on the rise once again.
From this perspective, the outlook for private landlords in 2022 is looking bright.
Rents Will Also Continue to Rise in 2022
The increasing demand for properties in London from professionals and students making their way back to the city is also causing rents to go up progressively.
So, after two years of uncertainty, it looks like private landlords can finally breathe easily. Our Stratford estate agents estimate that rental prices in London and particularly in East London will increase by at least 3 to 5% in 2022.
This is good news for existing private landlords as well as for those planning to acquire buy-to-let properties who have been postponing their decision to purchase such a property until the market has settled.
Another reason why our estate agents in Stratford expect demand to rise this year is that with mortgage rates climbing, it’s now getting more and more difficult for first-time buyers to get onto the property market. This means that many will continue to rent until they can come up with the funds to finally purchase a property of their own.
Finally, let’s not forget that demand is still exceeding supply all across the UK and this climate of economic uncertainty is making many potential buyers opt out of buying for now.
Therefore, as far as rents go in 2022, our Stratford estate agents predict private landlords are in for a good year, even the ones with inner-city flats that took the hardest hit in 2020 and 2021.
New Regulations for Private Landlords in 2022
On a less positive note, our estate agents in Stratford have one more prediction for private landlords in 2022. And that is new regulations imposed on rental properties.
However, new regulations don’t necessarily equal bad news.
Considering that more red tape and stricter rules may cause some landlords to sell their properties and look for other investments instead, this could very well mean good news for the private landlords keeping their properties. As availability decreases, the competition between renters will increase, even more, driving prices up as well.
The first type of new regulation for private landlords our Stratford estate agents expects to hear about in 2022 concerns energy performance certificates. This is because of the government’s commitment to achieving the target of zero carbon emissions by 2050.
For now, the regulations make it mandatory for landlords to have an energy performance certificate with a minimum rating of E. They are also required to perform gas safety checks each year for gas-fuelled properties.
As of April 2021, tenancies are also required to have a valid Electrical Installation Condition Report that can costs between £100 and £300 and get a new inspection done every five years after that.
Until 2025, our estate agents in Stratford predict that the government will gradually increase EPC requirements for rental properties up to a C-rating. This will definitely impact private landlords and cause them to incur costs that will affect their ROI considering that about 60-70% of rented properties currently have a rating of D or even below.
The average cost associated with making a property greener can range from £12,000 to £27,000. Therefore, our Stratford estate agents advise landlords to plan ahead and ensure their short-term investment plans take the costs of upgrading their rental properties to meet the required rating into account.
Another important regulatory change to watch out for in 2022 according to our estate agents in Stratford is the Renters’ Reform Bill.
Most landlords are still keeping their fingers crossed that no major changes will be brought on by this reform as regards Section 21 in particular. This is because, in its current form, Section 21 enables private landlords to repossess their properties without having to establish fault on the part of assured shorthold tenants.
The government has been debating ending the use of Section 21 for some time but, for now, there is no official information as to what specific changes are considered. One can only hope that any changes brought to the current regulations will take into account that both landlords and tenants can benefit from a clear and simple process of settling claims.
As far as this regulation is concerned, all anyone can do is wait and hope.
However, all in all, our Stratford estate agents are confident that 2022 will bring about a positive change for private landlords and will be a long-awaited first step in returning to the ‘old normal’.