18:14 PM, 2nd March 2011, About 10 years ago
Letting agents predict that the demand for buy to let rental homes will surge well in to 2012 as desperate tenants chase a dwindling number of available properties.
Six out of 10 letting agents polled by the Association of Residential Letting Agents (ARLA) are confident the market will continue to prosper for many months to come.
Many letting agents (40%) also feel more landlords will enter the private residential sector either because they see the advantages of investment or because they cannot sell their own homes and need to let them to move on.
“The lack of new rental stock for the private rented sector was the dominant factor in the market last year, and will continue well into 2012 because of the broader issues of diminishing housing supply and lending drying up,” said Ian Potter, operations director of ARLA.
He cited research by the Labour Party that shows 41% of young low-to-middle earners now live in private rented accommodation compared with 14% in 1988.
“The private rental sector is taking on the burden created by diminishing housing supply – a trend that will continue for the short to medium term. According to our research, this issue has been identified as UK-wide by our members but particularly pronounced in the south east and London,” said Mr Potter.
“With more consumers depending on rental properties and new landlords coming to market, the government must act now to address the quality of private rental housing stock. This means incentivising renovation, improving options for sustainable refurbishment, and introducing regulation to stamp out bad practice.”
ARLA wants the government to offer landlords incentives to revamp property in the Budget. Six out of ten ARLA member offices (61%) think that the quality of rental property will remain the same in 2011 but a minority of slightly more than a quarter (26%) think quality will improve.
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