9:27 AM, 31st May 2011, About 11 years ago
It’s official – thousands more tenants are chasing fewer buy to lets as online property portal Rightmove reports searches for homes to let are up 66% over the past two years.
In the same time, the number of available homes has dropped by 25%.
The latest rental market survey by the portal also reveals around half of tenants (49%) believe rents will be higher in a year – with 15% expecting them to rise by at least 10%.
The UK’s love affair with buy to let is also continuing as 43% of investors looking for property are first-time landlords.
“Further rent rises appear to be looming for many, putting additional upwards pressure on the cost of living for tenants in these inflationary times,” said Rightmove director Miles Shipside.
With such fierce competition for a dwindling stock of properties, those tenants that can play the trump cards of offering the highest rent and quality references will be best-placed to win the hand and secure the keys to the home they want.”
Rightmove blames the tight grip banks and building societies have on mortgage lending for stopping first time buyers, movers and landlords from purchasing property.
The firm’s research also suggests tenants are staying in their rented homes for longer, putting more pressure on the availability of private residential lettings.
“Tenant competition in many locations is hot. We see some new supply relief on the horizon in locations where capital values are low and rental yields are compelling enough to entice new landlords who are able to secure the necessary finance. However, this new supply to the market takes time to come through and is likely to be insufficient to meet demand,” said Shipside.
Property investors who want to put money in to buy to let said they are purchasing because they were primarily attracted by yields (43%) and around a third (31%) indicated that it was because of the relatively poor performance of other investment types.
“Where low capital values and good rental returns coincide rental property is hard to ignore as an investment option at the moment. With uncertainty about less tangible assets held in people’s pension pots, bricks and mortar once again look a more solid investment as part of your retirement planning,” said Shipside.