Letting agents are reporting tenant numbers are outstripping the supply of rental property, stating that “rent prices will just continue to rise”.
- The supply of UK property still cannot keep pace with rising demand from tenants
- Prospective renters registering with letting agents rose by 31% month-on-month in January
- Rental rates “will just continue to rise” while there is this imbalance, underlining how this underpins performance for British real estate investors
Demand for rental property continues to rise despite limited levels of supply – and this will inevitably lead to continued rent rises.
New research from agent body ARLA Propertymark found that there were 34 prospective tenants per member branch in January, a rise of 31% on December 2016. With 31 tenants registered in January 2016, it also means the demand for rental property has risen 10% over the year.
The report also found that 23% of letting agents experienced rental rises in January.
With the UK’s tenant population at record size and rising, the country’s well-documented undersupply of property continues to feel the pinch as it cannot keep pace.
Discussing the findings of his company’s report David Cox, Chief Executive of ARLA Propertymark, declared that when “supply and demand are out of kilter”, it’s only natural that “rent prices will just continue to rise”.
This latest research comes just weeks after the UK government released its much anticipated Housing Whitepaper, in which it highlighted the need for more investment in the purpose-built rental sector.
Recent tax reforms aimed at curbing buy-to-let spending levels have been viewed as a clear indication of the direction in which the government wants to see the rental sector taking. With buy-to-let property often outdated and poorly located, purpose-built rental property looks set to be the future of UK property investment.