RICS: Shortage of rent supply leads to higher prices

Shortage of rental properties in the lettings and sales segments present a massive challenge for the housing industry, according to the Royal Institute of Chartered Suppliers (Rics).

Research found that, in the three months to January, tenant demand for rental properties carried on to increase at the national level with the imbalance between supply and demand set to put further pressure on rental prices.

Exceptions to the pattern across the UK are to be found in London and Scotland where tenant demand is falling further. Rent expectations remain flat in Scotland, though they are more downbeat in London.

New landlord instructions in the lettings market failed to improve for the fourth quarter in a row. The Rics study suggests the issue could worsen over the medium term and indicated they believe landlords will decrease the size of their portfolios in the next three years.

Alterations to Stamp Duty in April, alongside scheduled cuts to mortgage interest tax relief, were viewed as important factors damaging the appeal of buy-to-let as an investment, with 28 per cent more respondents claiming landlords were likely to decrease the size of their portfolio over the next year.

What’s more, across the next three years, 26 per cent more contributors believed landlords will scale-back their portfolios.

On the other hand, house sales were flat for the second month in a row in January, while five per cent of surveyors recorded an increase in demand over the same period, marking the lowest reading since August 2016.

Sales are expected to improve in the coming months, however, with 15 per cent more respondents anticipating a rise in the next three months nationally.

Call Bowson Estates to help you secure a let on your property 0191 2128100 ext 1.