Cornwall estate agent says up to 70 people are applying for every rental property
A lot of demand is coming from other parts of the country
A director at one of Cornwall’s largest estate agents has revealed the factors currently driving the spike in demand for rental properties.
Jeremy Miller, director at Millerson, said that demand for rental properties in Cornwall was far outstripping supply, with every property advertised receiving up to 60 enquiries, often within the same day as going online.
He revealed that part of the increase in demand - up to a third - was from renters in cities such as Bristol and London wishing to move to Cornwall as well as a lack of properties.
Mr Miller said: “There is currently a colossal demand for rental properties and added to that is the fact there is not a lot of rental properties coming to the market. Part of that at the moment is that tenants know that they have protection from eviction as they normally would.
“In addition to that, there’s a huge demand for rentals down here from people in places like Bristol and London that work from home and want to come to Cornwall as working from home enables that. Since May last year at the end of the first lockdown, there’s been an incredible demand for rental properties from both people living locally and nationally."
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He also said that every property that was coming to the market was getting between 40 and 60 enquiries, with one property recently advertised in St Austell receiving nearly 70 enquiries within a short space of time. He said: “The rental market is very strong at the moment. One of my colleagues put a property in St Austell on the market to rent and by the time they’d returned to their desk they had 68 emails before the property came off the market again within hours.
"This, in turn, is increasing the prices of properties going to rent, because there's so much demand for what is available people are often willing to pay more."
Another factor playing into the situation currently facing the rental market is the withdrawal from the property market of some landlords, with the increased prices in the sales market encouraging rental investors to sell up.
Revealing that many of the properties sold by landlords were not being bought by other buy-to-let investors or landlords, Mr Miller added: “The sales market at the moment consists of around 70 per cent local demand and 30 per cent involving people from elsewhere in the country. The current coronavirus rules mean that some people can come down to buy but some can’t as you’re only allowed to travel elsewhere for a viewing if you’ve already sold your house.
"There are some who are buying properties on the basis of what they’ve seen on a video viewing, though.
“Landlords exiting the market contributes towards that. In a slow rental market, landlords will often be nervous about potentially having an empty property for months if they give notice to their tenant because of selling up whereas at the moment they’re able to cash in while the market is good, you’re seeing some landlords exit the rental market and offloading.”
Aside from the strong property market, Mr Miller said that the “Government were making an enemy of small-time property investors” due to heavy legislation and punitive taxation making it more difficult for small landlords to operate. Another reason for landlords selling up, he said, was the prospect of increased capital gains tax.
“The Government have made enemies of small-time property investors by making renting a property legislatively heavy and taxation punitive,” said Mr Miller, adding: “I think it’s going to end up with a lot of landlords in the future being large landlords owning multiple properties rather than small landlords with one or two properties.
“On the whole, individual landlords are more caring about the properties they own and the tenants living inside them and if this continues, particularly with the potential increase of capitals gains tax in coming years, we will lose a lot of good landlords.
“The Government are working against the rental market, with the legislation and taxation becoming so heavy that the small-time investors are asking themselves if it’s worth it. Landlords can no longer rent out properties in the lowest two energy efficiency groups, which while I understand the intention behind it, means that if a landlord has rented out an older property, for example to a tenant for a number of years, they are no longer able to do that and have to sell up meaning that landlords are now thinking about exiting the market rather than continuing.”