The availability of rental properties in the United Kingdom is getting worse. This news comes after new research released today from ARLA (Association of Residential Letting Agents).
The research covers April, May and June of this year and the latest quarterly figures show that 70% of ARLA members report that now there are more tenants than there are properties available for them to rent. The first quarter (January, February and March) had the figure 11% lower at 59% which still compares favourably with September last year when the figure was as low as 24%. In the South East of England, a much sought after area, 76% of member offices say that there are more potential tenants than properties. Owners could soon see increased interest in their property and would be well advised to have their landlord insurance in place now.
Ian Potter, the operations manager of Association of Residential Letting Agents, said: “This situation has been deteriorating rapidly in recent months, as the supply and demand of homes to buy is also swinging out of kilter – making the prospect of a severe rental housing shortage ever more likely. In his Budget, the Chancellor did little to incentivise investment in the private rented sector. In fact, the rise in Capital Gains Tax may actually discourage potential landlords from investing.”
The latest LSL Property services figures also show properties are in tight supply, which it claims is bolstering rents for landlords. Some landlords may even take advantage of this by increasing rents, even though June was the fifth consecutive month that rents showed a rise. The average rent is now £673 per calendar month, and this is the highest level since November 2008.
But David Brown, commercial director of LSL Property Services, said the real problem was not CGT but the restricted availability of buy-to-let mortgages. He said: “This has been the underlying factor holding back investment in the sector and the number of new rental properties hitting the market.” Letting agents and landlords could see rents rise over the coming months, as a drying up of available housing stock is being predicted.