No surprise tenants have suffered intense rent increases this year

by Property118.com News Team

9:52 AM, 4th December 2019
About 12 months ago

No surprise tenants have suffered intense rent increases this year

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No surprise tenants have suffered intense rent increases this year

As we near the end of 2019, Propertymark has analysed its sales and lettings data to reveal trends from the year.

ARLA Propertymark’s overview of the private rented sector:

– The supply of rental accommodation increased in 2019, from 187 on average per branch in 2018, to 197 this year. It reached an annual high in March, when letting agents were managing 203 properties per branch.

– As landlords continued to feel the pinch, the number of buy-to-let (BTL) investors selling their properties remained high, at an average of four in 2019. In April, the figure spiked to five per branch.

– The number of tenants experiencing rent hikes hit a record high this year, rising from an average of 26% each month in 2018, to 46% on average this year. This is due to the impact of the tenant fees ban, with 64% of tenants experiencing rent increases in August – the highest figure seen this year.

– Agents reported an increased number of prospective tenants searching for homes in August, when 76 were recorded per branch, compared to 73 on average across the year.

David Cox, Chief Executive, ARLA Propertymark comments on the findings: “It’s no surprise that tenants have suffered intense rent increases this year. We predicted this would happen as soon as the Government announced a ban on tenant fees, and since the ban came into force in June, rents costs have continued to spiral. Additionally, due to the significant amount of legislation that landlords face, this year they have continued to exit the market, which coupled with Brexit uncertainty and the looming general election has left the sector in a state of despair. Unfortunately, next year could go the same way, unless something is done to make the sector a more attractive investment.”

NAEA Propertymark’s overview of the housing market:

Over the course of 2019, demand was slightly higher than last year with an average of 320 house buyers registered per branch, compared to 318 on average throughout 2018. Looking back over the last decade, demand is up by 16 per cent, from 275 per branch in 2009.

The number of properties available to buy hasn’t changed significantly year-on-year, with 39 available per branch throughout 2018 and 38 in 2019. The month of August saw the highest number of properties this year, with an average of 44 available to buy. Supply has dropped considerably over the last decade, from 65 on average per branch in 2009.

The number of sales agreed per branch through the year remained the same at eight on average per month in 2019. Historically, this figure has stayed consistent, only moving between nine and seven between 2009 and now.

The proportion of total sales made to first-time buyers (FTBs) increased by two percentage points in 2019, from 25% in 2018 to 27%.

Mark Hayward, Chief Executive, NAEA Propertymark comments on the findings: “2019 has been an interesting year for the property market. House buyers and sellers have been faced with a lot of uncertainty, which in turn affects sentiment and decision-making. Activity in the housing market has remained consistent when compared to the last year, which was expected, as buyers and sellers hold off on purchases until the outcome of the General Election and Brexit is clear.”


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Comments

Whiteskifreak Surrey

10:57 AM, 4th December 2019
About 12 months ago

There might be more increases next year, as the S24 is really going to bite, in its 3rd year. But of course that will attributed to greedy landlords.
We do not really have any representation - NLA and RLA have been useless, but sadly Landlords Alliance is also not acting up to their promises... Really sad.

Hardworking Landlord

11:46 AM, 4th December 2019
About 12 months ago

The reported rent increases certainly support the argument to reverse S24 etc but just to keep it real, can someone say where the rent increases are and what percentage they have increased by? My experience is that rents have slipped backwards a little in the south east, and I have not increased any rents in my portfolio over the last 12 months on properties in the SE or Cheshire. In fact I have read some reports that show rent increases below inflation which would seem to imply we could be better off with rent controlls and a built in annual inflation increase! (not that Labour will get my vote of course!)

Martin

12:56 PM, 4th December 2019
About 12 months ago

I can only speak for myself, but my rents in the areas where it is mainly USAF tenants have remained static, but that is because you don't have to reference them.
The areas where I have UK tenants I have seen between an 8% and 10% rise in the market rate. I simply advertise my property to be the cheapest one of that size and standard so without making any conscious decisions the market has raised my rents. However all of the letting agents I use have increased their "find and sign" price by over 20% to cover their additional costs.

Simon Williams

14:19 PM, 4th December 2019
About 12 months ago

I often find these national surveys to be meaningless because renting is about numerous micro-markets. I have seen a pleasing uptick in demand in both SW London and Cambridge. This seems to be because I am facing less competition from other landlords rather than an increase in absolute tenant numbers.


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