Rents pushed up by high demand
In March this year, the Royal Institution of Chartered Surveyors (RICS) reported that the supply of properties coming on to the rental market had fallen for the second consecutive quarter, possibly bringing an end to the downward trend in rents that had been in place since autumn 2008.
In April, the Association of Rental Letting Agents (ARLA) found that over two thirds of agents were reporting that demand for rental properties had outstripped supply across the UK.
Today, the RICS published a report that suggests that the shortage of properties available for rent has continued to push rents up in the second quarter of the year, with supply falling for the fourth consecutive quarter during the three months to the end of June.
We were contacted by BBC (Radio) Oxford to give our opinion on these findings. Frank Webster appeared on the breakfast show this morning to discuss the supply/demand in the Oxford letting market.
Finders Keepers echo the findings of the RICS report. Buy-to-let mortgages are harder to get, there are lower levels of new-build property coming on stream and reluctant landlords are being tempted to try selling again, which have all affected the supply of property to rent in and around Oxford. At the same time, the large deposit required to buy property is leading to more people looking to rent. For properties in good condition, this means that landlords can ask a higher rent because of the combination of falling supply and rising demand (see our Quarter 2 report for examples of rents increasing by 7% in 12 months).
- We loaded 35% fewer properties on to the property portal Rightmove in the last 3 months compared with the same 3 months last year.
- Renewals (people staying put) increased 18% year-on-year for March to May
- The number of applicants registered by our 7 offices increased 16% for the first half of 2009 vs the first half of 2010.
- Our Bicester office have let 6 properties in the last 2 months, which failed to sell over the summer months. One of the properties had not had a single viewing in 8 weeks whilst for sale!
A RICS spokesman said “There is a possibility the lettings market could face a modest increase in supply in the coming months. Our latest survey shows a lack of funding has stifled demand from buyers which may cause some moderation to rents as more opt to let than sell.”
Frank Webster will also appear on BBC (TV) Oxford News on tonight at about 6.30pm.
If you are struggling to sell your property, or are considering buying an investment property, we can help. There is no risk to you: just give us a chance and you can see the response with no fees upfront. Just call 01865 302341 for an honest valuation.