AltFi.com uses cookies on this website. They help us to know a little bit about how you use our website, which improves the browsing experience and marketing - both for you and for others. They are stored locally on your device. By continuing to use this site you accept this use of cookies. Go to the Privacy and Cookies page for more information. You'll see this message only once.
Not signed in. Log in here.

Your daily download of all things alternative finance and fintech, from us at AltFi


 

Index Results Shed Light on UK Rental Space




By Ryan Weeks on 28th September 2015


The first results from Landbay’s recently launched UK rental index are in.

 

The Landbay UK Rental Index launched in mid September, with a view to allowing the platform’s investors to allocate funding to the platform in a more considered fashion. The first batch of results from the index have highlighted a number of geographical hotspots that investors may look to take advantage of. 

 

The numbers show that UK rents are rising fastest for 3 bedroom homes. Such rents grew 4.6% year-on-year in August, compared to a 3.3% for all UK properties. The rate being paid by tenants outside of London grew most rapidly in Windsor and Maidenhead (up 22% to £1,936), Southend on Sea (up 20% to £1,121) and Stirling (up 13.7% to £1,050). The full breakdown of fast-rising locations is available below.

 

 Counties outside          of London

Annual rental change (August 2015)

Average rent

Windsor and Maidenhead

21.5%

£1,936

Southend on Sea

19.6%

£1,121

Stirling

13.7%

£1,050

Dundee City

13.4%

£782

Swindon

12.6%

£813

Luton

12.3%

£938

Essex

11.3%

£1,116

Milton Keynes

10.5%

£983

Poole

10.4%

£1,223

Hertfordshire

10.3%

£1,396

Bedfordshire

8.8%

£884

Medway

8.7%

£861

Edinburgh City

8.3%

£1,200

Slough

8.2%

£1,271

Leicester

8.1%

£673

Kent

8.0%

£1,042

Wokingham

7.7%

£1,280

Newport

7.3%

£603

Gloucestershire

7.0%

£889

Portsmouth

7.0%

£960

 

The figures also show rents to have climbed by 3.3% (to £1,281) across the country as a whole. That rate of expansion is well ahead of inflation (CPI grew 0.1% in the year prior to July 2015). The rate at which UK-wide rents are growing has dipped a little from a high of 4.9% in February to the current level. Could this be a red flag for investors? John Goodall, co-founder and CEO of Landbay, weighed in:

 

“At the national level, rents performed very strongly in 2014 after a dip in 2013. This year has seen rents continue to grow, but at a slower rate. The macro trends at the national level aren’t uniform when you drill into the local level and look at different types of property, which is why we want to establish a rental index that gives landlords, tenants and others interested in the private rented sector access to a more granular level of insight.”

 

The peer-to-peer space has been at pains to provide investors with cold, hard performance data. A large number of the UK’s best-established platforms have published their complete loan books. Zopa, Funding Circle and RateSetter are constituents of the Liberum AltFi Returns Index (LARI). Landbay recently commissioned a third party data analytics firm to stress test its loan portfolio. These initiatives shed invaluable light upon the respective credit-related abilities of the individual platforms, and indeed of the sector as a whole. But for the secured buy-to-let mortgage platform Landbay, the income-generating capacity of the underlying assets is an equally important consideration, and the Rental Index should serve as a useful guide to investors in this regard. 

Comments


Enter your name:

Enter a comment in the box below: