Swindon’s largest property rental company says it comes as no surprise that the town is the most affordable place in the UK for people in work to rent a home.
Richard James, which has a 20 per cent market share of rentals in Swindon and manages 1200 properties, says investors UK-wide are recognising that the return from rental properties in Swindon now out-performs even the traditionally lucrative areas such as London and Oxford.
Last week, jobs website Adzuna compared average advertised salaries with average rental figures across the UK to find the most and least affordable towns and cities for renters to live. While Londoners pay 41per cent of their take-home pay on rent, and those renting in Oxford must set aside 39 per cent of net pay for rent, working tenants in Swindon typically spend just 11.5 per cent of salary on rent.
Sue Gidney, Richard James Lettings MD, said the firm has seen a sharp increase over the past few years in both the number of people moving from London, Reading and Newbury to rent in Swindon and in the number of professional landlords with large portfolios choosing Swindon as the place to invest.
“This research came as no surprise to us,” said Sue.
“Once people realised that electrification of the rail line to Paddington would reduce commuting time from one hour to 45 minutes, Swindon became a very attractive proposition. Non- residential investors make up a significant proportion of our landlords now. They take a look at the cost of buying a property in London, and the rental yield, then compare that to buying in Swindon and find Swindon makes far more sense.
“Not only is it far cheaper to buy property in Swindon, but employment levels and average salaries are also high compared to the UK average, which means it is easy to secure tenants who can easily afford the rent.”
Reputable letting agencies in the UK check potential tenants’ referencing ratio, that is the ratio between the asking rent and the would-be tenant’s income. Typically, the tenants’ joint or family income would need to be 2.5 times the annual rent.
“So if the monthly rent on a property is, say, £800 then the family, or two people sharing, would need to have a combined income of £24,000 a year, which in Swindon is very affordable,” says Sue.
Sue says that for landlords looking to invest in property in Swindon, there are two key features that are in high demand by tenants.
“Number one is parking,” says Sue.
“A garden is a nice-to-have, but parking is considered far more important by most people. And the other is two double bedrooms. Many tenants are couples who want to be able to have friends or family to stay, but we get a lot of professionals sharing too. And modern properties tend to be more popular with renters. If you can offer an attractive kitchen, good shower and neutral décor, your property is likely to be very sought after.”