The owners have been under the COSH for almost a decade of tax changes, greater regulation, increased costs and higher indebtedness costs. Are you about to turn the landscape for owners?
The yields are increasing as rental growth exceeds capital gains. The lowest base rates in 2026 will reduce savings rates and hope that this makes the highest yields in the house more attractive to investors, but only for appropriate houses.
Rent and management income is important, central income for real estate agents.
Our analysis shows that annual income is almost 10 billion a year with a 50:50 division between rent and management and sales. Income bias to rentals is higher in London, closer to 70:30 given the size of the rental market and the rental level.
This highlights the importance of owners for agents along with the motivations to continue investing in homes.
While private household actions in Great Britain have been static during the last 10 years, the strong rental inflation has supported management income. Rentals paid for older holdings continue to be restored to the market level.
Rentals have increased by a third in the last five years and are much higher in some markets. Rentals track long-term profits, so 2-4% of annual rental inflation is not a bad underlying trend
While there is a certain concern of the industry about the Rolers rights bill, half of the owners still do not use real estate agents to leave and management. The potential to increase income is equally higher with correct marketing tactics.
A higher proportion or smaller owners do not use agents and prefer the DIY option. This is becoming risky with the regulatory changes in Scotland and Wales and the Rolers Rights Law draft in England that will arrive soon. For those who like cash flow but do not like additional processes and requirements, the value of a good agent only increases.
Many owners who sell tend to own a property and have never seen it as a business. Almost two out of five owners bought their first property to live.
However, with seven out of ten owners of more than 55 years, there is a challenge about the options for owners who, because reducing or releasing capital. Agents also because to see a new wide part of the owners who enter the market.
Where the owners of the portfolio because to sell, the agents must analyze the option of bulk sales to other investors to keep the market shares instead of letting their own sales team or other local agents obtain their teeth in Intoto owners they seek to sell.
After a decade of the rationalization of the private sector and the owners who adopt a business model focused on cash flow, instead of pursuing capital gains with the maximum leverage, I think we will see investment levels to gain impulse once again.
The lowest base rates will reduce the risk -free rate and make the gross yields of the house look more attractive. The underlying cash flow remains strong and will be the key motivating factor for a new investment, special in the rental rental of the middle market.
If the maximization of loans remains important for some, then the highest yields, and the ability to take up to 75% of LTV remains in areas outside the south of England.
Whatever the strategy, the owners will want to buy houses that will have a lower cost to administer and run, with a view close to the probability that higher EPC ratings are required for rented homes from 2028.
The cultivation of a base of owners who prioritize the long -term cash flow is the optimal route to grow a rental book and a management book.
Richard Donnell, Executive Director, Zoople
