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UK rents set to rise in 2018, latest forecast suggests

Rent prices will increase next year, according to the latest property market analysis.

Shortages of suitable properties to let and greater demand from renters will result in upwards price pressure in new letting asking prices in many areas, says the report from ARLA Propertymark (formerly the Association of Residential Letting Agents).

Some 59% of agents expect to see rent prices increase next year, compared to just 19% who forecast they will fall.


Almost two-thirds - 62% - expect the supply of rental stock to decline in 2018, while just over half - 53% - think demand will continue to increase.

Seven in ten letting agents believe that the banning of letting agent fees will contribute to growth in rents, as many agents will seek to pass these costs on to landlords, who will need to recoup the costs elsewhere, inevitably through higher rents.

David Cox, chief executive, ARLA Propertymark, said: “2017 was a big year for the lettings industry, and tenants felt the effects of this. Unfortunately, it looks like rising rent costs are going to continue into the New Year as agents need to be moving into a 0% fee business model by October, which will push rents up as the costs are passed through landlords and onto tenants.

“There is a lot of other regulation making its way through Parliament next year, which will more positively affect the rental market however –  including regulation of the industry, housing courts and longer-term tenancies. While these policies will be developed rather than implemented, they should start to affect the market as agents adapt their businesses in anticipation.”

Aside from the supply of rental properties, which agents largely expect to fall, Cox also points out that the minimum energy efficiency standards coming into effect in the New Year could see up to 300,000 properties being taken off the market because they do not reach the minimum requirements, which in turn will drive rent costs up.

He added: “Overall, the industry is going through a seismic change and the lettings market we know today will be radically altered over the next five years. This change will be painful for agents, but we firmly believe that the industry will come out of the other end stronger, more professional and with a robust reputation among consumers.”

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  • G romit

    Wow, a rocket scientist in our midst!!

    Who'd have thought that increasing Landlords costs (loss of Wear & Tear Allowance, MIR Restrictions, SDLT Surcharge, banning Letting Agents fees, etc. etc.) would result in higher rents (Government/Treasury aside).

    And who'd have thought that by reducing profitability through punitive taxes/lower allowances (MIR Restrictions, W&T, etc), increasing regulation/bureaucracy (Right to Rent, Legionnaires, etc), and incessant demonising of Landlords in the media/housing charities (Shelter/Crisis/Generation Rent and central Government); would result in Landlords deciding that enough is enough and exit the market. (Again Government/Treasury aside).

    The (un)intended consequences of which will be increasing evictions (as Landlords are forced to increase rents), soaring homelessness, and escalating rents. Which no doubt the Government will respond by introducing more restrictions/regulations on Landlords (e.g. rent caps, reduced grounds for eviction) which will drive even more Landlords from the market and exacerbate the situation.

    As ever Government prefer to treat the symptoms (as it gives good headlines/sound bites), than addressing the actual underlying issues.


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