Tenants should brace themselves for soaring rents in the New Year, a property expert warns.
The National Association of Property Buyers predicts rents could rise by around four per cent in January because of the five-year record low supply of properties.
Spokesperson Jonathan Rolande says: “This will further add to the unaffordability faced by many tenants. What’s driving this? Well many landlords have suffered recently with changes to legislation, a general rise in agent costs following the tenant fee ban, tax increases and of course a hike in mortgage rates following the failed Truss Budget. But, more notability, the stock of rental properties is now at lowest we’ve seen since 2017. Market forces are therefore pushing up rents.”
He says because of wage stagnation, rent rises are paid for by tenants lowering their expectations and expenditure elsewhere.
“We’ve seen a landlord exodus in recent months, and this only looks set to continue. The recent rental restrictions in Wales, and talk of rent control in London risks ‘spooking’ the market and further reducing the number of landlords” says Rolande.
Commenting on the impact the rental situation is now having on tenants and landlords, he adds: “The ‘us versus them’ aspect of landlord and tenant debate is unhelpful. Usually portrayed as the bad guys, many landlords are under significant pressures with 22 per cent reporting that stress has caused mental health issues. Tenants rightly feel in a vulnerable position. The current situation is not working well.”
According to lettings agency Hamptons average rents in five regions have moved into a new price bracket in recent weeks.
Greater London was the latest, with rents passing £2,100 a month for the first time in October this year. It was driven by rents in inner London reaching a new record high of £2,863 a month in October, £1 a month more than when rents in London's priciest postcodes previously peaked in October 2019.
It means that rents in every area of the country are now above where they were at the beginning of the pandemic.
Since January 2020, just before the start of the pandemic, rents have risen 19 per cent across Britain. It is the equivalent of an additional £2,351 a year in rent, a significant sum of money to find amid the cost of living crisis.
Hamptons says there had been more rental growth since the beginning of Covid than for at least eight years prior.
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Every cloud has a silver lining
There are now regularly stories in the news about people unable to afford their homes or being asked to move with nowhere to go, many of them working people. There are also stories of the CBI wanting the Govt to relax immigration because we need more workers.
We do not have enough housing and the situation is getting worse. When is the Govt going to address this?
When they have politicians with an IQ in double digits.
We live in times of rocketing inflation, the official figure of 11.1% is way out, true inflation is much higher in the real world
This article is like all the others, we see the train wreck that’s coming…. The government is clueless.
The government is morally corrupt and owned by outside interests
Labour Tory just more wef puppets
Politics in this country is a farce. This budget is aimed at keeping the Tories in. They are hitting us hard in the pocket with taxes and austerity measures in order to give tax breaks in the election year.
We do not need all these measures now but we do need help for small businesses to keep the economy rumbling along. And we need section 24 to be abolished to encourage more Landlord's in the private sector.
I've read where others believe here that the Government want Corporations to run property empires. Is that not what social housing is now. Look at the consequences, no inspections, I doubt anyone has been round to peoples's houses, in some cases for years. Whereas private Landlords have a much more vested interest.
There is no chance of mould being in any of my properties that could affect someone's health.
I despair at this government but feel that Labour would be no better.
I will look at the Reform Party but would this just be a wasted vote.
This is a great country it's just being let down terribly by our so called leaders.
Still on the bright side got the footie to look forward to this afternoon.
Reform may well be a wasted vote, but equally isn't a vote for Tory, Labour or Lib dim also a wasted vote, one thing we can be sure of is a Labour government in 2 yrs time
I asked Reform for their position re the PRS and could not get an answer
Andy, Government want corporations to run property empires because they're substantial contributors to Tory Party coffers. They also keep well paid non exec seats warm for when the departing MP needs an exit plan after having levelled the playing field in favour of his corporate chums.
Seriously though, BTR only caters for 5% of the PRS at the moment, rising to about 8% by 2030 so they've really got their priorities horribly wrong. Unfortunately, they're all a bit thick so there won't be much change until they're literally hanging over a cliff.
Also, reversing policies won't change things. Example, say I bought a house in 2010 for £250k, rented for 11 years, sold in 2021 for £400k, paid my CGT and then paid down another mortgage as a result of landlord bashing. The government then want me back into the market as they've cocked up. Am I going to buy the house again at, say £450k with associated stamp duty, a much lower ROI, more tenant hassle etc etc - NO WAY!
And that's the problem but they just can't see it. See Ireland - that's exactly what's happening there
Hi Catherine, interested in your reply. Have emailed the Reform Party to see if I can get an update.
Hi Grumpy, read your reply with interest also. I know the debacle that went on in Ireland when they brought in the same policy years ago and then when they had collapsed the housing market for both buyers and renters they then reversed their decision. UK being a much bigger market and more importantly the incredibly low interest rates have delayed the issue here, though clearly this train wreck of a policy will keep on revealing itself!
Catherine - That is depressing 😰 we have nowhere to put our vote.
Tenants told to brace themselves.
That's known as foreplay in parts of Glasgow - quite apt in the context of looming rent rises!
I'm sure they will be wetting themselves Robert
One usual effect of Glasgow foreplay!
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