Letting agents have revealed continuing strong demand for rental properties but no let-up in weakening supply.
The fewer homes to rent is down to a reduction in the number of new landlords entering the market to replace those leaving but also more tenants staying put to avoid paying higher rents.
RICS polled its member agents this month, discovering that a surge in those seeing an increase in tenant demand during the three months to January.
Nevertheless, many report the 'heat beginning to come out of the market', which may offset a continuing decline in the number of landlord instructions coming through.
RICS’ latest rental index results are bad news for tenants, who will face higher rental prices in the coming months due to the imbalance between supply and demand.
Tom Bill, head of UK residential research at Knight Frank (pictured), says, “Pressure on landlords is unlikely to ease in an election year, which means low supply, high demand and more financial pain for tenants.
“The Renters Reform Bill, or any future incarnation under a new government, risks aggravating the imbalance by deterring landlords, so politicians need to be aware of the risks as well as the rewards of intervention.”
Robert Newton-Howes od Yorkshire Surveyors Limited, says: “Rents [are] still rising and [the] supply of houses is falling as landlords exit the market [with] low margins, higher taxes and tougher regulations all being cited as reasons for leaving the market.”
Allan Fuller (pictured) of London firm Allan Fuller Estate Agents, adds: “Lack of stock is still causing rents to rise; the entire system needs revision to encourage more investment in the private rental sector.
“Rogue landlords that do not maintain their property must be dealt with severely, but not at the detriment of the vast majority of fair landlords.”