Drop In Rent Rises Forecast
The result of a survey by Your Move and Reeds Rains in respect of forecast rent rises during the next year is a little concerning.
Presently, rental income on residential properties is rising by an average of 2.4% per annum. We don’t think many people can complain about that bearing in mind that the UK inflation rate dropped to 1.5% in August and the Bank of England have a target of 2%.
However, this survey is predicting that the average annual rise in residential rental income over the next year will only be 1.8%. This does rather put a different perspective on things.
It is also interesting to note that a large percentage (57%) of the 1,100 private landlords taking part in the survey do not intend to raise the rent that they will be charging their tenants over the next year. A lot of landlords that intend to raise rents are doing so with inflation in mind being the main reason with the second most popular reason for increasing rent being to cover the cost of maintaining the property.
On a more positive note, the survey revealed that 41% of landlords have seen an increase in interest from potential tenants in the past 6 months. This is borne out by the fact that there has been an increase of 6.9% in England and Wales in new tenancies in comparison with August last year. It is reassuring to hear that 21% of landlords feel that it is presently a good time to get into the buy-to-let market.
You will no doubt have your own views on the above and we would like to hear about them so feel free to leave your comments below. Can you relate to the above in the locations that you have your investment properties? If not, why is this?
We look forward to hearing from you.