Renters worry about how interest rate rises will affect them

Renters worry about how interest rate rises will affect them

0:01 AM, 14th March 2023, About A year ago 1

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Two-thirds of tenants say they worry about the impact of rising interest rates on their rent – and whether they will have a home, a survey reveals.

The findings from Finbri highlight another survey carried out by them revealed 53% of landlords are planning to raise rents if interest rates rise.

And now 63% of renters have expressed ‘concern’ or ‘strong concern’ about how this could affect their monthly rental payments.

The firm also reveals that 19% of tenants have already experienced unaffordable rent increases, along with other issues while renting.

‘Growing concern about interest rates’

Stephen Clark, a specialist property finance broker, said: “The growing concern about interest rates and the prospect of increased monthly rent is not unwarranted.

“Many renters have already been struggling to make ends meet even with the current interest rates, so understandably, they are worried about how an increase in interest could affect them.

“But landlords are also in a tough position.

“If their monthly mortgage payments on their BTL property increase as a result of rising rates, this additional cost needs to be covered.”

Private rented sector is vital in the UK’s housing market

He adds that the private rented sector is vital in the UK’s housing market and the relationship between tenants and landlords is ‘more symbiotic than ever before’.

Mr Clark said: “The private rental market is vital as it provides accommodation for those unable to get on the property ladder and landlords with an income.

“But with increasing rates, landlords are under significant pressure, with many looking to leave the market altogether.

“Renters are experiencing anxiety and fears over rent increases.

“During these uncertain times for the UK rental market, landlords and tenants must work together to navigate the current climate.”

Rents are growing at the fastest annual rate

Finbri also says that according to the Office for National Statistics, rents are growing at the fastest annual rate for more than a decade.

Tenants saw rents rising by 4.2% last year and, outside of London, rents have increased by more than 3% so far this year.

Rightmove says the average rent outside of London is £1,162, while it’s £2,343 in London, where rents have increased by 16% in the past year.

Mr Clark says: “Rising interest rates are a cause for concern for many renters, as they can lead to unaffordable rent increases.

“Renters must research their options and proactively prepare for these changes.”

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Anne Nixon

11:55 AM, 14th March 2023, About A year ago

I feel for renters and their rents rising at the fastest annual rate and also for owner occupiers and landlords who have seen their mortgages rise at the fastest annual rate in recent years, and for everyone, all of us, coping with raging inflation affecting our cost of living, food & fuel etc.
This is the same for everybody.

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