Get to know your local job market to understand tenant and landlord trends, says this agency
Property consultancy Bidwells has been in the Cambridge rental market for over 100 years, and has a strong understanding of how the job market for their tenants affects lettings and property investment for their landlords in the area.
"Our agency has been in Cambridge for over 100 years and so has a strong
understanding of the market - and how it's changed over the years," says Alex Bloxham, Partner and Head of Residential Lettings at Bidwells. "It's important that we know what's current and topical and plan ahead."
The local job market's impact on lettings
The way the job market has developed across Cambridge over the years has helped to predict the patterns in the tenant market. "Cambridge has many different science and business parks as well as companies such as, Amazon, AstraZeneca, Apple, all based in the city centre," says Alex. "Many international companies are establishing themselves in Cambridge and attracting a younger demographic, across their workforce. And a lot of them are looking to rent initially."
For many, the attractiveness of renting comes down to its flexibility. "It's difficult to save the deposit for a house but renting offers flexibility and the ability to move. People are not really perceiving it as 'I've got to get on the housing ladder' anymore. The beauty of being a tenant is that you're in a flexible position and following a six or 12 month agreement, you just need to give two months' notice and you can move again."
Rolling and short-term tenancies suit the fast nature of the Cambridge job market, where tenants will move around based on the length of time they stay in a job. Alex highlights that tenants tend to arrive with two year job contracts, which inevitably has an impact on the length of their tenancies. "You just need to look at our figures on the Goodlord platform," he explains. "We dealt with a high number of tenancies in 2020, and the average tenancy length was approximately 12 to 18 months, which provides an overview and understanding of what the market is like."
Investment opportunities for land buyers and landlords
Gaining this market understanding is key for agents, who can then share the information with buyers looking for safe investments. "Having such big companies move in to the city, it's made the property market in Cambridge a lot more stable," says Alex. "Employment levels in Cambridge have been surging recently. The build programmes over the recent years have been incredible."
That's one reason why the investment market in Cambridge has always been strong, despite it being an expensive area to buy land or property. "Average yields are between three to five percent gross - but you need to look at the safety aspect of your investment," says Alex. "You are going to be able to rent out your investment all the time. You're going to be able to minimise your void periods - they're currently at around a week to 10 days, and the capital growth of your property over 10 years will be strong."
Shelly MacDermott, Business Development & Marketing Coordinator at the agency, predicts that this will continue, albeit with a different focus, post lockdown. "I'm sure that lockdown will have an effect on how house builders will design homes in the future - thinking about workspaces, outside spaces, amenities, due to remote working," she says. "It's going to be at the forefront of their decision making and planners and the council are going to be instrumental in pushing that as well."
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