The survey found that 22% more surveyors expect rents to rise rather than fall in the next three months and the number of rental properties coming onto the market fell for the first time since January 2008.
The recent pick up in the housing market has led to drop off in the number of rental properties, particularly houses, being made available. As a result, surveyor optimism has increased for the first time since July 2008 and 22% more surveyors expect rents to rise rather than fall in the next three months.
A net balance of 11% of surveyors have seen the number of new instructions coming onto the market falling rather than rising. This is in contrast to levels seen in late 2008 when the housing market was still suffering from falling prices and many would-be sellers were turning to the lettings market when their houses failed to sell.
Demand for rental property is still rising as 16% more surveyors saw activity over the past three months pick up. Demand for houses is particularly strong with 22% more surveyors reporting rising rather than falling numbers of people looking to rent. Tenant demand was strongest in London, but increased in most other parts of the country.
Jeremy Leaf, spokesperson at RICS, commented: “It seems the current upward trend in the housing market is having a more significant effect on the lettings market, with many of the accidental landlords returning to the sales market to take advantage of the recent price increases.”
“As a result the recent oversupply is reversing, with new instructions at the lowest levels we have seen. This of course is impacting on prices and tenants no longer have as strong a bargaining power as they did,” he concluded.
