House rents set to rise due to rising demand

There have been reports that house rents are set to rise by at lease 15% over the next two years, this is a direct result of a shortage of supple and rising demand. It seems that buyers are struggling to get on the housing ladder, so are now choosing to rent instead.

This report was carried out by Reading University’s Professor Michael Ball for the Association of Residential Letting Agents.

Ball has estimated that the value of assets in the private rented sector has now reached £500bn; as a result he said that this totally outstrips the total of all privately owned commercial property.

Looking to the future it is assumed that rental growth will continue in the short term, this is some comfort to buy-to-let landlords. They have been facing a huge drop in the values of their properties as house prices have been falling across the country.

Landlords were hoping to get more relief from the Bank of England by lowering the base rate this month, but that did not come. Many believe over the coming months, The Bank of England will have to lower interest rates, so it seems win win for landlords.

Source