Tenant demand up as rent hikes subside – ARLA

by: Christine Toner
  • 26/10/2017
  • 0
Tenant demand up as rent hikes subside – ARLA
The number of letting agents who saw landlords increasing rents to 27% in September, down from 35% in August, the latest report from the Association of Residential Letting Agents (ARLA) has revealed.

The figures represent the first month-on-month decrease since May, when the figure also stood at 27%. But year-on-year the number of tenants experiencing rent hikes is up; in September 2016 only 24% of agents reported their landlord clients were raising rents.

The private rental sector report also found demand for rental properties increasing, with agents reporting 79 prospective tenants registered per branch in September, up 10% from August when there were 72 per branch.

David Cox, ARLA Propertymark chief executive, said: “Last week’s consumer price index (CPI) showed inflation rose to 2.8% in September, up from 2.7% in August. As the cost of living increases, the last thing tenants need is for their rents to rise, so while it’s great that month-on-month we’re finally seeing a decrease in the number of landlords hiking costs, we need to look at the bigger picture.

“There are still more than a quarter of tenants experiencing rent hikes every month – and that’s too high. As summer drew to a close demand increased in line with our expectations, and while it’s too soon to see the effect of this on rent costs, we know that when supply and demand are conflicting, rent prices will just continue to rise.”

Make ends meet

Ying Tan (pictured), managing director of Buy to Let Club says the figures were expected.

“It’s not surprising we’re seeing tenant demand grow. High inflation and stagnating wages is making it difficult for would-be buyers to save for deposits and with an interest rate rise on the cards we could see more people looking to the rental market as mortgage rates rise.

“The fact that fewer landlords are increasing rents is good news for consumers but the government still needs to recognise that the changes it has implemented on the market will have an affect on costs for landlords and many will have no choice but to hike rents to make ends meet.”

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