A busy 2014 is predicted for letting agents, according to new figures from LSL Property Services.
Positive results of a recent poll of 2,195 landlords indicate a prosperous coming year for the private rental sector. Landlords have experienced boosted confidence through growing tenant demand, with rising prices enhancing properties as surefire investment opportunities.
The survey suggests that 41% of landlords questioned reported a rise in tenant demand within the last six months. Just one in 16 experienced a fall. Demand led to a marked increase in rent rises during 2013. 58% expect the demand to increase again during 2014.
18% of landlords plan to extend their portfolio in the next twelve months, with 16% expanding in 2013.
David Newnes, the director of LSL Property Services, was pleased with the findings of the survey and said that they emphasized the growing rental sector. Newnes said: “The rise in house prices is evidence of the underlying buoyancy in the property market and the stabilising of rent rises is an indication of the current healthy state of the rental sector.”
He continued by saying that landlords are in “a prime position to benefit from the strong yields on properties” and that “buy-to-let investors can be encouraged by the climbing tenant demand.” Mr Newnes went on to say that the demand not only signifies an “excellent long-term investment opportunity,” but also “demonstrates the continued the continued appetite for rental homes.”
Rick Flay, director of Belvoir Sheffield, said that tenant demand in his city was increasing at a incredible rate. Flay said :”Here at Belvoir Sheffield we are seeing proof that tenant demand is certainly increasing, to the point where we are seeking out new properties in Sheffield and the surrounding areas.
“We are urgently looking for one and two bedroom flats in Sheffield, along with one and two bed terraced houses in the S1, S2, S3, S7, S8, S10 and S11 postcodes, after a significant increase in tenant enquiries.”
Tenant demand to increase
Mr Newnes also underlined the rising stock in the rental market. He stated: “Demand for rented accommodation is strong, exemplified by the fact that the number of lettings, new viewings and applicants are all rising. There are strong foundations for prosperity in the rental sector, fuelled by increased economic optimism and future job creation. Against the backdrop of growing economic stability, more confidence is driving people forward in search of the attractive deals on offer across the buy-to-let mortgage market, which will allow them to benefit from the attractive returns.”
Looking ahead, Mr Newnes urged action to be taken to help first-time buyers raise adequate finances to secure a mortgage, to save over-reliance on the rental sector. Newnes said that “securing mortgage finance is therefore not just a concern excusive to frst-time buyers but remains a real and serious challenge for many landlords.”
He acknowledges that “lending to first-time buyers and those without large deposits has itself seen a pick up,” but says this “still has a long way to go.” Newnes warns that “it is the rental sector that will be continually needed to pick up the slack.”