Is rising rental demand taking its toll on tenants?
by Sarah Ashcroft
Rising rental costs are taking their toll on tenants, which in turn could be affecting landlords rent books
The latest figures from haart indicate that residential rent increases
have been slowing across the country since the start of the year, following on from record rises in 2011.
Hometrack strategy, risk and economics director Gary Styles is particularly shocked by figures in London.
In one month, the capital has seen typical rents fall by 4.3 per cent, standing at £919 at the end of May. This compares to rises of 0.7 per cent outside of London.
"We have seen a moderation in the pace of rental growth and it is not a surprise given what has happened in 2011," explained Mr Styles. "I am a little bit surprised by the size of that [haart figure], but we need to see a couple of months' figures before deducing that there is a change of direction."
However, he does concede that there are different factors at play in the capital compared to other parts of the country. "Affordability is becoming quite strained, but I would see that as much more of an issue - given the special factors in the London market - outside of London."
Despite this negative outlook for the rental market, the latest figures from the Royal Institution of Chartered Surveyors tell a slightly different story. The latest survey indicates that more members are reporting rental rises over the three months to the end of April, suggesting demand is on the increase.
Rics global residential director Peter Bolton King believes there is still a reassuring buoyancy to the rental market, with tenant demand expected to continue to outpace supply.
But he does concede this will inevitably push up rents, placing even more strain on struggling households in an already challenging economy.
- Landlord and Tenancy News from Lawpack: Solicitor-approved Rent Increase Notice (Section 13) with expert guidance on how to complete the legal form
Published on: June 8, 2012
Did you like this article? Share it!