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For landlords and property investors, location diversification is a proven strategy to build a robust and balanced portfolio. Each region within the UK presents unique opportunities, and Kent is no exception. Its blend of connectivity, economic growth, and diverse housing markets makes it a key contender for Buy-to-Let investors.
Known as the ‘Garden of England’, Kent provides a wide variety of locations for property investment, catering to a large pool of tenants.
Kent, known as the ‘Garden of England’, provides a wealth of property investment opportunities, attracting a diverse range of renters. From the ancient charm of Canterbury and the commercial energy of Maidstone to the elegant streets of Royal Tunbridge Wells and, the globally linked Ashford and the artistic vibe of Margate, the county is rich in options. Commuter-friendly Sevenoaks and the coastal towns of Folkestone and Dover, with their broad price brackets, appeal to distinct tenant demographics.
House Prices in Kent
Kent’s unique appeal, driven by a sought-after blend of leafy suburban living and convenient access to London, has significantly boosted rental demand in recent years.
If you’re considering a Buy-to-Let investment in Kent, especially if you’re not familiar with the market, understanding localised demand and property value variations, which are influenced by factors like transport connectivity and desirable neighbourhoods, is an important step of the investment process.
While some areas command premium prices due to their popularity, like Sevenoaks where average house prices are £824,022 (Rightmove) and Royal Tunbridge Wells around £540,872 (Rightmove), other areas like Chatham, where average values are £299,951 (Rightmove), may offer more cost-effective opportunities for those willing to explore beyond the usual hotspots.
It’s no surprise that property values in the South East of England are higher when compared to other regions, so it’s important to establish the demand and average rents to paint a clear picture of the rental yields on offer. Connecting with local estate agents can provide valuable insights into property values, rental demand, and potential returns, helping you to establish whether a Buy-to-Let in Kent is the right move for your portfolio.
For those investing with capital growth in mind, Savills’ latest five-year forecast predicts a robust 18.2% house price growth for the South East, just shy of the national 21.6%. While this regional average is strong, remember that significant variations exist within pockets of the South East. Popular towns and cities in Kent with solid market fundamentals have the potential to outperform this overall projection, presenting unique opportunities for investors.
Rental market Kent
From coastal towns to commuter belt hotspots, Kent offers distinct rental prospects for different types of landlords and renters.
Coastal areas like Dover are appealing for their relatively lower property prices and higher yields. In contrast, towns such as Dartford, with its strong transport links, offer the potential for steady and reliable returns from professionals who commute to the capital.
Data published by Kent Live in September 2024 paints a picture of a dynamic rental market across the county, with significant variations in both rental costs and growth rates.
Folkestone and Hythe experienced the steepest annual increase at 14.2%, despite maintaining an average rent of £1,015 per month. Sevenoaks remained the most expensive area, averaging £1,648 per month, while Dover offered the most affordable rentals at £874. Maidstone also witnessed a substantial rise of 11.3%, bringing its average rent to £1,179. Canterbury saw the smallest increase at 4.6%, with average rents reaching £1,152.
As you can see, this relatively recent data highlights the localised nature of rental market trends within Kent, showcasing diverse investment opportunities and tenant affordability across different rental hotspots.
When it comes to tenant profiles, renters in Kent range from young professionals seeking proximity to London, to families and students attracted by the county’s excellent educational institutions. This diversity in tenant profiles necessitates a strategic approach to property selection, aiming to cater to different needs and preferences.
Being aware of these market dynamics and demographic trends can assist landlords in making informed investment decisions. By selecting the right property in the right area, landlords can maximise their rental yields and ensure a steady stream of tenants.
Types of Buy-to-Let in Kent
Beyond traditional Buy-to-Let tenancies, a variety of housing is required across Kent, making it an ideal choice for landlords interested in venturing out into different asset classes.
Kent’s strong university presence, with institutions like the University of Kent consistently ranking highly in national guides, presents a strong case for student property investments and Houses in Multiple Occupation (HMOs). The University of Kent’s top-tier ranking in the South East and solid national standing underscores a consistent demand for student accommodation in key locations like Canterbury and Medway.
Investing in student properties or HMOs offers several advantages for landlords. Student populations typically provide a reliable and consistent rental market, with annual tenancy cycles aligning with the academic year. HMOs can also offer higher rental yields compared to standard residential properties, as landlords can charge per room, maximising income potential. The consistent demand from students seeking affordable accommodation near campus allows for high occupancy rates.
For those looking to capitalise on the UK’s staycation market, the variety of things to do and see in Kent makes it a top choice for those looking to invest in the furnished holiday lettings (FHLs) market.
Last year, the county was ranked the UK’s top family staycation destination in a Go. Compare survey, highlighting its strong appeal to domestic tourists. Coastal towns like Folkestone and Margate, which have undergone significant regeneration, are also experiencing a renaissance, attracting visitors with their revitalised seafronts, art scenes, and family-oriented activities.
At a time when staycations are continuing to rise in popularity, Landlords looking to enter the FHLs market may wish to add Buy-to-Lets in Kent to their portfolio.
London Commuter Belt Appeal
Whilst Kent stands out as a prime market for Buy-to-Lets, its close proximity to London cannot be overlooked. In recent years, there’s been a notable increase in London workers moving to commutable locations, seeking larger living spaces, lower costs, and access to greener spaces.
For landlords looking to capitalise on this trend, towns such as Gravesend are well-serviced by high-speed rail links, significantly reducing commuting times to London. The appeal of shorter travel times can drive up demand for rental properties in these areas, providing landlords with a steady stream of potential tenants.
Alongside Gravesend, other towns within the commuter belt, such as Dartford and Sevenoaks, also present appealing investment prospects. These areas benefit from excellent transport links, reputable schools, and desirable local amenities, making them attractive to a broad range of tenants, including families and young professionals.
Given the cost of living crisis and the rising cost of renting in London, many people are reevaluating their lifestyles and opting for more affordable housing in the commuter belt without sacrificing the convenience of city access. This trend will likely continue, providing long-term stability and potential for growth in rental demand within towns and cities, offering convenient access to London.
Overall, Kent presents appealing opportunities for Buy-to-Let investors. Understanding tenant demographics and preferences is one of the key pieces of the puzzle for those looking to maximise occupancy rates and returns. From young professionals seeking proximity to London to families prioritising good schools, tailoring properties to meet these needs can significantly reduce vacancy periods.
If you’re a landlord based in Kent or interested in connecting with property professionals in Kent to help you on your Buy-to-Let journey, click here to claim your free ticket for the Landlord Investment Show in Kent.
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