Landlords 'should think carefully before pushing up rents'
by Sarah Ashcroft
Property owners who are hoping to earn more money as they feel the pinch in the current economic climate have been warned to consider the implications of increasing the rent
before actually doing so.
According to David Lawrenson, private rented sector expert at LettingFocus.com, it may be better for landlords to receive a regular income from tenants who reliably meet payments every month rather than putting them under more financial pressure.
The industry expert said that between six and 12 months ago, there was panic among cash-strapped individuals due to rapid increases to rental prices - which were brought on for a number of reasons.
However, he claimed that the cost of leasing a property has not risen sharply during the last five to ten years, despite the fact that there have been periods where they have gone up at a much faster rate than inflation - particularly in London.
Mr Lawrenson's comments were made after Paragon Mortgages revealed that 91 per cent of landlords said that they thought that tenant demand was stable or growing.
Research carried out by the provider highlighted that just six per cent of proprietors claimed they believe fewer people are looking to rent a property in the current economic climate.
In addition, landlords reported an average of 12.5 properties in their portfolio during the third quarter of 2012 - with many claiming this is set to rise to 12.9 buildings in 12 months' time.
Mr Lawrenson also noted that real wages are not going up at the moment and all individuals are feeling the squeeze brought on by the ailing economy, which has brought about a cap on what people can afford.
He explained: "There is a limit to what people can pay and a landlord ought to think carefully about this because it is better to have someone who is paying regularly and appreciates the place, rather than trying to go for the maximum achievable and then finding that you can't let the place and can't fill it."
- 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: October 10, 2012
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