Demand for rental property outstrips supply
Research has revealed the rental market started the year on the back foot, with the gap between supply and demand for rental properties widening in January. More prospective tenants than stock coming onto the market found the supply of rental properties falling by 8% from December to January.
David Cox, chief executive of ARLA Propertymark, said: “This month’s results indicate that renters are in for a rough ride in 2018.” Members reported 70 prospective tenants per branch in January, compared to just 59 in December. However, supply dropped from 200 to 184 over the same period.
Cox continued to say, “Housing stock is falling as rising taxes continue to force established landlords out of the market and deter entry into the sector – and the volume of renters is increasing as the cost of buying a home is moving further out of reach for many.
“The fact that one in five tenants are experiencing rent increases is just another blow. Ultimately, until the prospect of investing in the buy-to-let market is more attractive for prospective landlords, and stock subsequently increases, tenants will continue to feel the burn.”
The rising rents have been reflected in data from Your Move. The agent’s England & Wales Rental Tracker for February shows annual growth for rents increased from 2.3% in December to 2.5% in January.
Also highlighted is the average rent in England and Wales was £829, with the North West and East Midlands growing fastest, up 2.9% annually to £636 and £652 a month respectively.
London continues to be the most expensive part of the country to rent a property, with rents at £1,276 a month on average, however, this is down 0.8% annually.
The biggest percentage fall was in the North East, where rents declined by 2% in the 12 months to January to £534 per month. It remains the cheapest place to rent in the UK.
Martyn Alderton, national lettings director at Your Move, said: “With more tenants seeing renting as a long-term option, landlords, with their letting agent’s support, should identify features to encourage longer tenancies. A recent survey found that tenants were prepared to pay more for communal living extras, such as a shared garden, childcare facilities or a gym.”