Horncastle rents set to rise to an average of £503 pcm in next 5 years

Article Simon Jory 2017-12-28
Horncastle rents set to rise to an average of £503 pcm in next 5 years

It's now been a good 12/18 months since annual rental price inflation in Horncastle peaked at 3.7%. Since then we have seen increasingly more humble rent increases. In fact, some properties saw a slight fall in rents. So, could this be the earliest indication that the trend of high rent increases seen over the last few years, may now be starting to buck that trend?

Well, possibly in the short term, but in the coming few years, it is my opinion Horncastle rents will regain their upward trend and continue to increase as demand for rental property will outstrip supply.

The only counterbalance to that improved rental growth would be to meaningfully increase rental stock. However, because of the Government's new taxes on landlords being introduced between 2017 and 2021, buy-to-let may become less attractive in the short term for certain types of landlords, meaning less properties will be bought to let out.

Interestingly, countless market experts assumed at the start of 2017 that the number of rental properties would in fact drop throughout the year. The assumption being as the new tax rules for landlords started to kick in, landlords looked to kick their tenants out, sell up and invest their capital elsewhere. Although ironically that would lower supply of rental properties, decreasing the supply, meaning rents would increase again.

Anecdotal evidence suggests landlords are either (1) re-mortgaging their Horncastle buy-to-let properties instead or (2) converting their rental portfolios into limited companies to side step the new taxation rules, rather than selling up.

The sentiment of many landlords is that property has weathered the many stock market crashes and runs over the last 50 years. There is something inheritably understandable about bricks and mortar - compared to the stock market and other exotic investment vehicles.

Remarkably, there is some good news for tenants, as the Tory's published the draft Tenants' Fee Bill, which is designed to prohibit the charging of tenants' lettings fees on set up of the tenancy. However, looking at evidence in Scotland, I expect rents to rise to compensate landlords, thus hammering faithful tenants looking for long-term tenancy agreements the hardest. This growth will be on top of any usual organic rent growth. It really is swings and roundabouts!

So, what does this all mean for landlords and tenants in Horncastle? In my considered opinion,

Rents in the Horncastle area will rise by 9.9% over the next 5 years, taking the average rent from £458 per month to £503 per month.

To put all that into perspective though, rents in Horncastle over the last 12 years have risen by 18.7%. In fact, the rise won't be a straight-line growth either. The national and local economy, supply and demand, interest rates, Brexit and other external factors need to be taken into account. Please see the graph below for my projections

Historic and Projected Average Monthly Rents

In the past, making money from buy-to-let property has been relatively easy. But with these new tax rules, new rental regulations and the overall changing dynamics of the property market, landlords are going to need work smarter.


  1. Regional past and present rental movements taken from Belvoir, LSL and ONS rental indexs and combined to provide an overall movement.
  2. Future rental movements taken from what CW thinks will happen again regionalised.
  3. Current rental figure taken from Zoopla

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Simon Jory

Simon Jory

Simon has been in Estate Agency for over 32 years and is a Fellow of the National Association of Estate Agents. Having working in all kinds of changing market conditions he is well placed to advise on how best to sell your home.

Anne Pearce

Anne Pearce

Anne prides herself on working to the highest standards and believes everyone should receive the best possible customer service. With over 20 years' experience she will not miss and opportunity.


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