Rents continue to rise as tenant demand grows

In recent years, landlords have benefitted from a surging demand and fierce competition for rental properties in large parts of the UK.

This has allowed them to keep increasing rents to keep up with the rest of the market – a situation that many hope will remain for some time to come.

According to Zoopla’s new data, this doesn’t look to be changing any time soon. They have reported that the number of available rental properties is 43 per cent below the five-year average – increasing demand among tenants searching for a new home.

As a result of this, despite the challenges of the pandemic, UK rents increased on average by 4.6 per cent year-on-year between September 2020 and September 2021.

In fact, if you exclude the Greater London area, where rent rises have been more subdued, average rents rose by 8.6 per cent during that same period according to Rightmove. This is the highest growth on record in the last 13 years.

Chris Norris, Policy Director for the National Residential Landlords Association said: “2021 showed some signs of recovery for the private rented sector, which tends to be counter-cyclical in nature, with economic uncertainty leading more people to rent rather than commit to large purchases.

“Demand for rental accommodation increased across the UK, with some early indications that tenants are also returning to London after many left during lockdown.”

Looking ahead, experts have said that rent rises in the next 12 months will, in part, depend on whether demand continues to outstrip the number of suitable homes.

As a result of this, Propertymark has explained that some estate agents are warning cautious landlords to retain their portfolios, despite the demands of new regulations and tax rules.

Nathan Emerson, Chief Executive of Propertymark, added: “Looking into the private rented sector, rental income is poised to remain strong as demand holds steady.”

If you need advice regarding your property portfolio and the impact of rising rents, please speak to us.