October 29, 2011
City Centre Apartments Shortage For Buy To Let Landlords
There is now a shortage of city centre apartments to rent, says property investment firm Assetz.
Chief executive Stuart Law says the former excess supply has now been corrected due to substantial growth in tenant demand and a lack of new supply.
But he says that the belief that the situation still persists is hampering the financing of much-needed new development and compounding a serious shortage of apartments.
After the city-living boom turned to bust in 2007, there were well-documented stories of finished apartment blocks where the lights never went on, mothballed schemes, bankrupt developers and buy-to-let investors who had burnt their fingers buying off-plan apartments at inflated prices whilst tenants proved elusive.
However, Assetz claims demand is now far outstripping supply and forcing rents dramatically upwards.
Law said: “As the myth of oversupplied city centres perpetuates, the shortage of apartments in cities such as Manchester and Leeds is resulting in significant competition between tenants and driving up rental values.
“Banks refuse to fund much-needed development which is worsening the undersupply situation, and with no measurable new-build properties completing in the foreseeable future, tenants are going to find themselves increasingly squeezed out of core areas.”
