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Rents continue to be driven by lack of supply
This article is an external press release originally published on the Landlord News website, which has now been migrated to the Just Landlords blog.
A severe shortage of properties available continues to push rental prices upwards across the UK, according to the Association of Residential Letting Agents (ARLA).
Over a quarter of letting agents saw rents rise during June, despite a rare increase in supply of rental stock. There was a 31% rise in agents reporting rental rises during the month – the highest level since April 2016.
Supply and Demand
During the past year, the supply of rental stock has increased by 8%, with letting agent managing 190 properties on average per branch in June. Demand slipped however, with an average of 61 new tenants registered per branch – a fall from 65 in April and May.
Landlords are facing more and more pressure, following a raft of recent alterations aimed at halting the rush of investors. These include the 3% stamp duty surcharge and the phasing out of mortgage interest tax relief.
Rents continue to be driven by lack of supply
David Cox, Chief Executive of ARLA, observed: ‘With the cost of living on the rise and inflationary pressures tightening, the last thing tenants need is for their rents to continue rising.’
‘However, the fact that supply looks to be rising, while demand has dropped slightly indicates a move in the right direction for the market. Ultimately, to stop rent prices from increasing too much, we need to find the balance between supply and demand,’ he added.[1]
[1] https://www.landlordtoday.co.uk/breaking-news/2017/7/housing-shortage-drives-up-rents
