The demand for rental properties in the UK, including the capital, is on the rise with more number of house-hunters registering with estate agents. This is an indication of the buoyancy in the UK lettings market, which is considered one of the most lucrative for landlords and buy-to-let investors.
The latest report on the Private Rented Sector (PRS) by ARLA (Association of Residential Lettings Agents) depicts a heightened activity in the UK lettings market with the residential real estate sector demonstrating stability.
The number of prospective tenants registered per ARLA member branch continued to rise, increasing by 9 per cent in April 2018. In March 2018, the same agents had 66 tenants on their books on an average, compared to 72 in April. This is the strongest demand seen since September 2017, when there were 79 prospective tenants registered per branch.
However, there has been no corresponding increase in the supply of rental properties to the market. In fact, the Federation of Master Builders had earlier this year expressed concern over the poor supply of homes to the market. If the same trend continues, there could be pressure on the rentals and landlords might consider increasing them for new tenants.
Incidentally, many tenants have experienced hike in rents in view of the shortage in supply of rental properties to the market. According to ARLA, over a quarter (26 per cent) of tenants experienced rent hikes in April, compared to 23 per cent in March. This is the highest since September 2017 when 27 per cent of landlords put rent costs up for tenants and continues the upward trend which has seen the number of landlords hiking rent costs rise every month since October 2017.
Tenants in the East Midlands experienced more rent hikes, where 56 per cent saw their rents rise, compared to London and North East where just 11 per cent did.
The number of rental properties managed by agents per branch has remained consistent at 175+ since the last three years. In April 2018, the average number of properties managed by agents per branch was 179. In April 2017, the agents managed a similar 185 per branch but in April 2016, they managed 183 and 193 were recorded in 2015. The supply of rental properties was highest in the East Midlands, where agents managed 247 properties per branch.
The London lettings market is an attractive investment option, especially for buy-to-let investors, as the rent has been consistently growing at 4 per cent in the capital. If you are keen on exploring our buy-to-let properties, call our London office for an appointment.