Fantastic news for all buy-to-let landlords; the first quarter of 2011 has seen some of the fastest-growing rental figures in nearly a decade. Rents have increased across the board, from 1-bed apartments in the City Centre to 2-up, 2-downs in Heaton Mersey. And with yields of up to 8%, Manchester is witnessing the return of the buy-to-let landlord.
1. CITY CENTRE
Manchesters city centre rental market has taken off with gusto in the first quarter of 2011. We have let and re-signed 104 apartments in the first three months of the year with an average price increase of 5.94%. Nearly two-thirds of our properties have increased in value without a single rent drop – this is a record for our Deansgate office and we expect the trend to continue into the second quarter. From January to March we made our landlords an extra £15,228 in rental income.
Increase: 59.62%
Stable: 40.38%
Decrease: 0%
Average Increase: 5.94%
Total: £15,228
2. SOUTH MANCHESTER
Our offices in Withington, Didsbury and Reddish have seen a significant jump in rental prices in the first three months of 2011. Although more rental values remained static than increased, the properties where prices did rise significantly out-performed the city centre market with a staggering 7.96% increase across the board. These are some of the most positive figures we’ve seen in a long time and are helping to reassure those landlords who are worried about possible interest rates rise in the coming months. From January to March we made our landlords an extra £26,402 in rental income.
Increase: 42.03%
Stable: 49.28%
Decrease: 8.7%
Average Increase: 7.96%
Total: £26,402
3. TENANTS RE-SIGNING
If a tenant is happy to stay and a landlord is happy to keep the tenants in place, we always do our best to add a token increase in rent to keep both parties happy. Our landlords understand that void periods are an investor’s worst nightmare so they’re happier with a smaller rent increase if a tenant stays. However, market forces are still driving rents across Manchester so we’ve been able to achieve a 4.40% increase in rental for re-signing tenants, with less than 1% of tenants negotiating a cheaper rent. From January to March we made our landlords an extra £19,740 in rental income.
Increase: 30.09%
Stable: 68.98%
Decrease: 0.93%
Average Increase: 4.40%
Total: £19,740
4. TESTIMONIALS
The first quarter of 2011 has seen some very encouraging figures for buy-to-let landlords, but don’t just take our word for it. Our landlords’ recommendations speak for themselves;
XQ7, Salford Quays
2-bed Apartment
Annual Rent Increase: £480
“I wanted to let you know how very pleased I am with the management service I receive from Philip James. It’s also good to know that the rental income is on the up, and Philip James have increased my rental from £635.00 to £675.00-per-calendar-month. We now have 3 of our rental properties with you.”
– Bhavisha Chwda
Great Northern Tower, City Centre
2-bed Apartment
Annual Rent Increase: £1200
“I would like to thank you and your team at Philip James for finding a tenant for my apartment in Manchester before departure of the existing tenant, thus continuing the occupancy without a break, and also for achieving an additional £100 per-calendar-month rent.”
– DG, Manchester
Withington Point, Withington
2-bed Apartment
Annual Rent Increase: £900
“I’m very happy with the recent price increase at my apartment in Withington Point, the price has gone up from £625 to £700 per-calendar-month and Philip James take care of everything”
– Mrs Wang
Rippingham Road, Withington
4-bed House
Annual Rent Increase: £1200
“I’m very pleased with Philip James. I used to deal with Homes4U but you are a world apart. You give good service and always find me good tenants – I’ve got no complaints!”
– Mrs F. Azough
Victoria Mill, Reddish
1-bed Apartment
Annual Rent Increase: £300
“The guys at Philip James were great at communication and we’re very happy with the price increase they achieved – we didn’t expect to get that much.”
– Miss N. Dean
CONCLUSION
If you’ve ever considering investing in a buy-to-let property now is the time. In the first three-months of 2011, Philip James has negotiated rent increases of up to 8%, let 537 properties and earned our landlords an extra £60,000 in rental income. And with suggestions that the Bank of England is unlikely to increase interest rates until Christmas, we expect rental yields to continue their upward trend throughout the year. Buy-to-let is most definitely back.
