If you have dreams of investing in a rental property and becoming a landlord you may be wondering if 2024 is the year you should make your move. Is the time and market right and do the benefits outweigh the risks?

Bargains To Be Had

The current market situation suggests it could be a good time to become a landlord, especially if you already have a property that you can let or enough spare cash to invest. Although interest in house sales is increasing, prices are not expected to start rising again significantly until 2025. That makes it a buyers’ market out there which also means there are bargains to be had – especially if you are a cash buyer looking to start or build a rental portfolio.

Consider Mortgage Rates

If you are investing in a rental property considering mortgage rates and how they are likely to change will be vital to your decision-making. These have been impacted by rising interest rates designed to curb inflation but the BofE’s decision to hold the base rate at 5.25% in February is driving optimism that the worst may be over and that interest rates, and subsequently mortgage rates, will be cut. However, you should also consider whether you would still be able to make your mortgage repayments if mortgage rates were to go up again.

Rising Rents

Rent price levels are also continuing to increase, up by between 5-6% in 2024 and seeing cumulative growth of around 20% or more over the next five years. As inflation settles this will allow for good levels of rental profit to be made. This is the result of a number of factors such as potential buyers holding off and instead renting until buying conditions improve or landlords leaving the market because of challenging conditions. Such factors have led to a shortage of rental properties as demand has consistently outstripped supply in the market.

But Beware Of Political Impacts

One thing to bear in mind, however, is the possible impact of politics on your plans to become a landlord in 2024. As well the Renters (Reform) Bill making its way through Parliament there is also the prospect of a general election at some point.

Housing and reform of the private rented sector are likely to be high on the political agenda and the and any changes could have a significant impact on market confidence.

As we’ve seen there are encouraging signs as to the health of the rental market despite the uncertainty that suggest that 2024 could be a good time to become a landlord, you just need to be cautious and make sure you understand all the possible implications.

At PH Estate Agents, we understand the significance of timing and market dynamics in the realm of property investment, particularly in regions like Cleveland and North Yorkshire. Rooted in traditional estate agency values of trust and unparalleled customer service, our dedicated team specialises in both residential and commercial properties. Whether you’re considering selling or letting, we offer comprehensive services tailored to meet your needs. From market valuations to full-service lettings management, our experienced team is here to provide expert guidance every step of the way. Reach out to us today to explore how we can assist you in navigating the property landscape with confidence