An encouraging new report has indicated that a lesser number of tenants are experiencing rent rises.
Data from the investigation from the Association of Residential Letting Agents (ARLA) shows the total number of letting agents reporting rent increases for tenants dipped to 25% in the last month, in comparison to 32% in September.
This represented the lowest number of monthly rent hikes during 2015.
Demand for rental accommodation fell in October, as did supply of available accommodation. ARLA agents recorded 33 new tenants on average per branch during the month, the lowest of the year.
However, the rental market in the capital went against this trend. The report indicates that demand for privately rented accommodation rose in the capital during October, with an average of 42 new prospective tenants registered per branch, an 8% increase from September.
Supply for rented properties dropped in line with typical seasonal demand, falling from 182 properties per branch in September to 173 in October. Would-be renters in the East of England and in the South West have the best chance of securing a property, with agents in these regions managing 199 and 184 properties respectively.
Fewer tenants see rent increases
David Cox, managing director of ARLA, said that the findings, ‘should bring some relief to tenants before Christmas. It’s definitely a step in the right direction, however a quarter of tenants are unfortunately still seeing hikes.’
‘Although it’s typical that demand dropped at this time of year, as there’s a seasonal lull in the run up to Christmas, we expect to pick up again in January. Looking ahead to next year, we’d hope to see the number of tenants experiencing rent hikes remain low with supply and demand leveling out. However, a lot is resting on the economic and political agenda,’ he continued.
Cox went on to say that, ‘we’re still waiting for new houses, promised by the Prime Minister to be built. Whilst this will take pressure off the rental prices as supply rises, the changes to landlord tax proposed under the Finance Bill is likely to discourage new landlords from entering the market.’
‘Further, it’s been a waiting game all year to see if Mark Carney will raise interest rates in the New Year-this will play a big part in determining whether renters looking to buy a home will be able to afford to. And when interest rates do rise, the goal of homeownership will be pushed further out of reach for many and of course put further pressure on the private rental sector,’ he concluded.