As an estate agent in Finchley, London, it's crucial to stay informed about the dynamics of the private rented sector, especially given the recent trends and forecasts that are likely to impact both tenants and landlords in our area.
Currently, the UK’s private rented sector is experiencing a significant imbalance between supply and demand. This trend is not showing signs of slowing down. In fact, it's leading to a notable increase in tenant demand for rental properties. This high demand is driving up rental prices, a trend that landlords in our area should be aware of.
Recent data from Paragon Bank highlights this trend vividly. An impressive 71% of landlords surveyed reported an increase in tenant demand in the third quarter of this year, a jump from 67% in the second quarter. This marks a record high in tenant demand since these surveys began 12 years ago by BVA BDRC.
The impact of this demand is not uniform across the UK. In the West Midlands, for example, 76% of landlords noted a stronger tenant demand in Q3, the highest in the country. This was closely followed by Wales (75%), the South East (74%), and the East Midlands (73%).
This surge in tenant demand has a direct correlation with rental prices. A significant 87% of landlords in the survey reported observing rent increases in their areas, with 70% admitting they have raised their rents in the last 12 months. This trend is set to continue, with over half (54%) of landlords planning to increase rents in the next six months by an average of 8.4%.
It's important to note that while the high demand is a key driver of these increases, other factors are also at play. For instance, 66% of landlords cite rising operational costs as a reason for increasing rents, and 48% are adjusting their rents to cover higher mortgage expenses.
For tenants, this information is crucial for planning and budgeting, especially those considering renewing their tenancies or entering new rental agreements. Landlords, on the other hand, should consider these trends in the context of their investment strategies and property management decisions.
If you have any questions, or you need guidance in making your next move in the local rental market, David Harris & Co is your Finchley letting agent to trust.
Richard Rowntree, managing director for Mortgages for Paragon Bank, has called for more investment in the buy-to-let sector, saying: “During the first two quarters of the year we saw record levels of tenant demand reported by landlords. For this to be surpassed in Q3 highlights how the imbalance between the supply of rented homes and demand from renters is not improving. This reduces choice and increases competition for renters, while fuelling rental inflation, a scenario that often impacts the most vulnerable to the greatest degree. With social housing unable to meet this demand and home ownership aspirations hindered by cost-of-living pressures, further investment in the PRS cannot be delayed.”
We have assisted many Finchley landlords connect with willing tenants, and we know where these groups are looking for rental accommodation. You can take the stress out of connecting with your ideal tenant by turning to a local lettings agent in Finchley.
If you want to make an informed decision in and around Finchley’s rental market, we are here for you. If you have any questions about the local market, or you need assistance, please contact David Harris & Co today. Call us on 0208 346 9122.
