As if the uncertainty surrounding the coronavirus pandemic isn't enough for the UK's army of renters to cope with, with the UK set to sever ties with the EU from January 1 2021, the country could face a glut of returning expats seeking a rental home while they decide on their next move.
Brexit will mean a loss of some rights for many Britons living overseas within the EU which could make moving back to the UK the best option open to them. However, knowing where to live and making plans for the future may result in hundreds or even thousands of new tenants looking for rental homes to give them time to make the best decision relating to their future living arrangements.
Retired Expats Show Interest in UK Rentals
Research suggests that some 20% of expats considering or planning to return to the UK are retirees, which could raise demand for rental properties in retirement developments. This could prove positive for lettings agents and landlords of such properties but possibly push rents higher for the prospective tenants - something that is potentially true across all rental homes.
Indeed, two retirement home providers have shared their experience and views as the end of the Brexit withdrawal year draws closer.
According to Cognatum who manages homes and estates for the retirement market, they have experienced an increase in enquiries from retired expats living abroad in the EU and considering a Brexit-induced return to the UK. With complex logistics and the onus on making the right move for the long term, managing director John Lavin shares some advice over those making the move.
“It’s important not to make a bad move at this time of life as moving costs in the UK are high. It’s better to rent in the short term than to choose badly due to time pressures,” he says.
In the meantime, Girlings, a firm which is also expecting an increase in the number of retired expats searching for a rental home in the UK suggests retirement developments as a good option to rent, either for the short or longer term. Choosing to rent in a development that has been created precisely for the needs of retirees could help reduce the pressures and worries of moving back to the UK during a pandemic and under duress associated with Brexit.
Can the UK’s Rental Market Cope?
While an increase in potential tenants across the country would be good news for the UK letting agents, landlords and property investors, it could lead to a renewed increase in demand for rental homes which would likely push rents higher. That’s something that could prove problematic for many existing tenants in the UK right now, given the economic uncertainty, job cuts and decline in earnings amid the coronavirus pandemic.
Given the existing lack of the right homes in the right places already plaguing the rental and sales markets during more ‘normal’ times, its likely that some areas of the UK might not have enough supply to provide a potential glut of returning expats, including retirees, with the rental property they need.
Of course, when demand rises it tends to encourage more development and investment which should result in increased supply of property to rent and buy in the future. However, as with many things, that will take time which means that as things currently stand, any rise in demand for rental homes in 2021 should benefit landlords but possibly prove a problem for some tenants.