Why Rents Will Rise In 2017

Why Rents Will Rise In 2017

14:42 PM, 11th January 2017, About 5 years ago 65

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The fact that landlords want/need to increase rent to cover increased costs isn’t necessarily evidence that rents will actually rise.

However, there are a number of other important factors to consider, not least of which is supply and demand. Why Rents Will Rise In 2017

Government policy to reduce investment into property for business purposes (letting) is working. The surcharge on SDLT for second properties has had the biggest impact and I have no doubt that many rental business owners are selling at least some of their properties due to the changes to mortgage interest relief. The will grow exponentially when the real effects of the tax begin to bite.

Whilst the supply of quality rental accommodation has slowed, and may even be going into reverse, the polar opposite is happening to rental demand. It is increasing, and at quite a pace too.

There has been talk of glass ceilings for rents however, whilst the number of people wanting to rent properties continues to grow the outcome is inevitable. Those that can afford to pay more will win. The losers will be those who cannot afford to pay more. If all of those tenants who cannot afford to pay more are displaced by those who can we might ask ourselves where they will live. Will they miraculously be able to afford to buy the properties from those landlords who have simply had enough and chosen to sell?



Comments

by Monty Bodkin

8:24 AM, 22nd April 2018, About 4 years ago

Reply to the comment left by Mick Roberts at 12/01/2017 - 07:08
"It's only when they get their tax bills in few years time that the shit will hit the fan."

Many of us assumed this.

The thing is, there are no 'tax bills' as such.
It is a self assessment. The latest tax return only makes a very vague reference to s24. So landlords that weren't aware of it before, still won't be when they complete their tax return.

Just as there has been no mass panic sell off either.

Rent increases due to s24 will be slowly drip fed into the market over a long period of time.

Personally, over the last year, I have increased rents by 10% as and when properties become vacant. No problem getting applicants (40 on the last one), just being very selective choosing the right tenant.

by Mick Roberts

8:40 AM, 22nd April 2018, About 4 years ago

Reply to the comment left by Monty Bodkin at 22/04/2018 - 08:24Yeah the amount of people Landlords I talk to that still don't know about S24.
And also Selective Licensing in their area, they han't got a clue.
All more sellers when they decide too hard and too expensive.
And me too, more selective now. Used to let anyone to a degree have a house.
Now there's that many of em asking, I'm going Letting Agent route, let them do the checks and guarantors etc. Feel sorry for the lower HB tenants, they have no choice now. Amount of calls I have off people that are on their Mums Sisters settee etc. And Husband with 2 kids at Mums and his missus with one kid at her sisters. Cause their Landlord wanted the house back to sell.

by Monty Bodkin

10:15 AM, 22nd April 2018, About 4 years ago

Yes, this will hit those at the bottom hardest Mick. It is not as black and white as just rent rises on a national index. This is an (edited) email I've had recently, one of many;

Please consider me for renting your house. Not long ago I have broken my spine. I've had many operations but stairs are no problem for me now. I don't smoke, drink or party. I don't have pets and my place is always very clean. I am very respectful of neighbours. I really need this house. I just want a nice place to call my own. Please can you get back to me? At least give me a chance. I'm not a person to beg but I really need this. I am on universal credit/pip for the first time ever after working all my life. I know you don't take dss but please give me a chance. You will not regret it. Thank you. Please, please call me.

by Mick Roberts

11:05 AM, 22nd April 2018, About 4 years ago

Yes this Govt at top not got a clue have they.
They think everyone can and should work and get their own house just like that.

by NW Landlord

11:19 AM, 22nd April 2018, About 4 years ago

I had so many similar stories to the one above, people practically begging to let my houses when they come availability the main issue due to landlords selling off

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