The UK rental market in 2024 has shown significant activity, driven by various economic and social factors. Here’s a detailed look at the trends shaping the rental landscape so far, focusing on rental yields, stock levels, rent increases, and predictions for the remainder of the year in key cities like London, Manchester, Liverpool, and Birmingham.

Rental Yields

Rental yields in 2024 have remained strong, particularly in regional cities like Manchester and Liverpool. These cities continue to attract young professionals and students, driving demand for rental properties. London, despite its higher property prices, maintains competitive yields due to consistent demand from a diverse tenant base. Birmingham also offers attractive yields, benefiting from ongoing regeneration projects and a growing population.

Rental Stock Levels

Rental stock levels have been fluctuating across major cities:

• London: The capital has seen a slight increase in rental stock as more properties become available in 2024 compared to the severe shortage we experienced in 2023.  However, demand still outstrips supply, particularly in central and well-connected areas.
• Manchester: This city has experienced a stable rental stock, supported by new residential developments. E.g. Three 60 but despite this, high demand is keeping the market competitive.
• Liverpool: Similar to Manchester, Liverpool has a balanced rental stock with new developments coming online. The city’s affordability compared to other major cities keeps it attractive to renters.
• Birmingham: Birmingham’s rental stock has increased due to new projects, but high demand, especially from young professionals and families, keeps the market tight.

Average Rent Increases

In the first five months of 2024, average rents have risen notably:

• London: Average rents have increased by approximately 6%, driven by strong demand in prime locations.
• Manchester: Rents have seen a rise of around 5%, reflecting the city’s popularity among young professionals and students.
• Liverpool: The city has experienced a 4% increase in average rents, fuelled by a growing interest in urban living.
• Birmingham: Rents have gone up by about 4.5%, consistent with the city’s economic growth and population influx.

Predicted UK Rental Market Trends for the Remainder of 2024

The rental market is expected to maintain its upward trajectory for the rest of 2024. Key factors influencing this trend include:

• Economic Stability: As the UK economy stabilizes post-pandemic and post-Brexit, rental demand is likely to remain strong.
• Urbanization: Continued urbanization and regeneration projects in cities like Birmingham and Manchester and London e.g. Tottenham, Canada Water will continue to boost rental markets.
• Interest Rates: Current interest rates are prohibitive for homebuyers getting onto the property ladder, increasing demand for rental properties as an alternative.

Impact of Upcoming General Election on UK Rental Market Trends

The UK general election in July 2024 adds an element of uncertainty and potential change to the property market. With predictions of a Labour government coming to power, it will be interesting to see what policies they introduce that could impact the rental market or property market in general in the UK. There needs to be a balanced approach from any new Government to assist first time buyers gain a foothold on the property while continuing to attract investors to the market due to affordability constraints for local buyers.  Investors and landlords should stay informed about these developments, as new regulations could influence rental yields and property values.

Rental Supply vs. Rental Demand

The imbalance between rental supply and demand persists, particularly in major cities. While new developments are adding to the rental stock, they are not sufficient to meet the high demand ad will impact UK Rental Market trends.

• London: Demand for rental properties continues to exceed supply, especially in central areas, pushing up rents.
• Manchester: Despite new builds, the city’s appeal to young professionals and students ensures that demand remains high.
• Liverpool: The city’s affordability attracts a steady stream of renters, keeping demand robust.
• Birmingham: The influx of businesses and professionals relocating to the city maintains high demand for rental properties.

Conclusion: 2024 UK Rental Market Trends

The UK rental market in 2024 is characterized by strong rental yields, rising rents, and a persistent imbalance between supply and demand. Key cities like London, Manchester, Liverpool, and Birmingham continue to attract renters, driven by economic opportunities and urban living appeal. As we move through the remainder of the year, these trends are expected to persist, underscoring the resilience and attractiveness of the UK rental market for both tenants and investors. The outcome of the upcoming general election and potential policy changes will also be crucial factors to watch. For further information on our competitive all inclusive Letting and Management fee, reach out to book an appointment.