The North West company is a specialist at providing buy-to-let properties to the private investor market and, against the backdrop of rising house prices and a booming rental market, currently has eight developments in construction on key sites across the UK.
Having launched more than 30 buy-to-let developments onto the UK market since the beginning of 2012, totalling more than 3,000 units at a value in excess of £195million, Knight Knox International is a specialist in the sector and has a vast portfolio of past, current and future products to its name.
Celebrating its 10-year anniversary in 2014, the company has grown exponentially over the past two years, focussing largely on residential apartments and private student accommodation projects across the country.
This growth has largely been the product of a rising demand from investors for buy-to-let stock. The current housing crisis is pushing up the value of rental properties across the country, with off-plan developments becoming increasingly popular due to the extremely competitive price point they enter the market at.
Demand for rental accommodation is the highest it has ever been, with an estimated 1.2 million more households renting from private landlords at the start of 2011 than there were in 2006, compared to a decrease of 130,000 in owner-occupiers over the same period.
The rise in house prices over the past 3-4 years, coupled with a lack of construction in all areas of the country, has resulted in a lack of affordable housing, preventing first-time buyers from taking their first step onto the property ladder.
The North West in particular is experiencing an unprecedented boom; rents have increased by 6.6% since 2002 – the highest increase in the country, and Manchester was named as one of HSBC’s ‘Top 4 Buy-to-Let Hotspots’ in 2013, recording average rental yields of 7.6%.
A successful provider of both off-plan and refurbishment projects, Knight Knox International has noticed first-hand the speed at which the market has moved over the past 18 months.
Lee Chettoe, Sales Manager at Knight Knox comments, “In October 2012 we launched Phase One of our X1 Salford Quays development, which allowed investors to purchase a 1-bed apartment for as little as £85,000. The launch of Phase Two 11 months later saw 1-bed apartments priced at £90,000 and our most recent residential development in the area – X1 The Exchange, has a starting purchase price of £97,500.
“Whilst we strive to remain competitive for our investors, there is simply nothing of the same standard on the market today for less than £100,000, which highlights just how far and fast the market is moving. The potential for capital appreciation in off-plan units is something that our investors are acutely aware of and, coupled with the knowledge that their investment will be let and managed for them, is a driving factor in the increased demand we are experiencing”.
Home to over half a million people, Manchester is a city whose population has out-grown its current housing supply and is in desperate need of new stock, paving the way for a raft of new investment as the construction industry begins to pick up pace. Currently the top area in Britain (outside of London) for new constructions orders – more than £1.2billion worth of new orders were won by contractors in the period July to December 2013, the highest amount since 2009, indicating a level of confidence in the market not seen since before the 2007 property crash.
Working in partnership with three leading developers, Knight Knox International is planning to launch over 1,000 units onto the UK market over the next six months, with the majority of those located in the North West, as a solution to the chronic undersupply currently being experienced in the region.