Wednesday, 3 June 2015

Sunderland Rental Stats May 2015 - Increased Supply & Reduced Demand

Last month was an odd month, I don't suppose having the General Election helped much but we did get a general feeling that whilst the supply of properties coming onto the market continued to increase following the usual seasonal lull in the first quarter of 2015, there was a distinct lack of tenants out there!

As always, the stats I've used are pulled from Rightmove data & given Rightmove is the most popular site, whilst this doesn't include Zoopla, OnTheMarket etc it would be fair to expect Rightmove trends to reflect the wider market

On first glance they do tend to back up our anecdotal observations

Looking first at the supply of properties onto the market, when compared to March data (sorry, I didn't get round to doing the April figures, promise it won't happen again...) there is a 17% overall increase of available properties 

This is very much to be expected, every year we see a significant increase in properties coming onto the market post-Easter

Looking at each area in turn, SR1 is pretty much exactly the same as in March, and continues to show the often mentioned over-supply (versus our expected 5% of all rental properties being on the market at any given time)

The SR2 postcode goes from (an unusual) situation of shortfall in March to the more normal & expected slight oversupply again in May

Increases in the number of available properties in SR3, SR4 and SR5 in the month of May reduce the shortfall but aren't enough to exceed the expected 5% of all rental property being available - good news for Landlords with properties in those areas as it suggests tenants will again be fighting to get a decent property 

The area showing the largest reduction in available property is SR6, with a 30% reduction vs March 2015

Overall, taking Sunderland as a whole we have a situation of overall shortfall, with 4.4% of all rental properties being on the market in May (when you'd expect there to be 5%), however this is moving in the right direction from 3.6% in March

Turning our attention to tenant demand, as I mentioned when I first analysed this earlier in the year it's not an exact science as whilst Rightmove allows analysis of tenant searches to be further broken down by named area, it doesn't do so on a postcode basis, so the following table isn't going to exactly match the postcodes on the Supply table above, but it should be pretty close...

This month I'm just going to concentrate on the 'by area' searches, I can look at the searches by property type, price band etc another time

Overall, 'by area' tenant searches were down 12% vs March - if I'm honest I would have expected the drop to have been a bigger one

Of most concern is that whilst the number of available properties in SR2 increased by 41% against March, tenant searches for properties in this area decreased by nearly 18%, so whilst this isn't the largest drop by area (searches in SR6 fell by 20%) it shows the greatest discrepancy between supply and demand

The other key stat to pull out (and it reaffirms my consistent recommendation to look to this area due to the demand from Good Tenants) is that the only area bucking the trend and showing an increase in tenant searches vs. March is the SR5 area that includes Downhill, Town End Farm, Redhouse & Hylton Castle

I'm pleased to say the stats back up our general anecdotal observations about how the market 'felt' to us in May 

With this in mind, the good news is that in the past couple of week we've noticed a sharp increase in the number of tenant enquiries and even more pleasing is that they all seem to be serious, willing to view and committ rather than just being the time wasting 'tyre-kickers' which you can get from time to time (especially in the quieter months) - we'll look at the June stats next month to see if they back up our observations

Call me on 0191 567 8577 or email to what this means for your property investment in Sunderland or to have a free, no obligation chat about any aspect of the Sunderland property market

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