0:02 AM, 23rd August 2023, About 2 years ago 3
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The strongest tenant demand in the country is being seen by landlords in outer London and the East Midlands, research reveals.
Paragon Bank says that in the second quarter of this year, 91% of landlords in outer London reported a surge in tenant demand, with 67% stating the growth is ‘significant’.
In the East Midlands, 86% of landlords noted a rise in tenant demand, followed closely by Wales at 82%.
However, the North East emerged as the region experiencing the weakest tenant demand, with 69% of landlords noticing an increase and just 6% seeing a fall in demand.
Paragon’s commercial director of mortgages, Louisa Sedgwick, said: “Tenant demand shows no signs of slowing down in many parts of the country.
“With supply not growing quickly enough to keep pace, we are seeing rental inflation and that is likely to continue until we see demand more in balance with supply.”
Overall, 67% of landlords in Britain reported escalating levels of tenant demand – matching the figure from the first quarter and an equal record high.
Though the proportion of landlords who said that demand is falling fell from 4% last quarter, to 2% in the last quarter.
Paragon’s survey also highlights how strong tenant demand is pushing up rents with 87% of landlords saying rent prices had risen in their area.
And 51% of landlords say they will put up rents in the next six months.
The areas where landlords are most likely to increase rents are Wales (94%), the North East (92%), Yorkshire and Humber (91%), and the East Midlands (91%).
The main reason for rent rises is inflation with 74% of landlords pointing to higher operational costs, with 59% of landlords put up rents to market levels.
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Kate
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Member Since August 2023 - Comments: 12
11:14 AM, 23rd August 2023, About 2 years ago
In the main l put up rents when tenants leave unless they stay for 5 years or more which some of them do. I put the rent for a new tenancy at market rate so that the rent’s buying power does not drop too much in the years that follow. I am fortunate not to have any mortgages on my rented properties as l have owned them for a long time. I have reassured all my tenants that l will not put up rents during this high period of inflation so that they do not worry. I think life is stressful enough without worrying about whether you can pay the rent.
PAUL BARTLETT
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Member Since May 2023 - Comments: 195
12:03 PM, 23rd August 2023, About 2 years ago
Since the Bank of England monetary policy committee meets every three weeks with the power to increase Base Rate, while the Section 13 rent increase can only be served once a year there is no balance here. Thus annual rent increases have to be part of a well made Tenancy Agreement with CPI linkage to ensure that everyone is clear about market values, and knows what to expect.
In fact the current imbalance of supply and demand means that CPI would under-estimate the market value. So market testing should be part of the TA since that’s what the valuation tribunal does anyway. Tenants should accept CPI linkage as everything else is in that situation..
GlanACC
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Member Since March 2023 - Comments: 1484
8:06 AM, 27th August 2023, About 2 years ago
Good luck in finding somewhere to rent in the East Midlands. Driving round my estate you can see all the ex-rental 1 and 2 bed properties up for sale. They are still within the price range of first time buyers but potential landlords have ignored them.