Wednesday 4th March 2015

Rent rises in the New Year for one in four letting agents

The Association of Residential Letting Agents (ARLA) recently launched its first monthly Private Rented Sector Report, which keeps a keen eye on the main market trends within the private rented sector. 

On average just over a quarter (27%) of ARLA licenced branches saw a rise in the cost of monthly rent for tenants from December 2014 to January 2015, the report found. 

The East of England witnessed the highest number of landlords increasing rent per calendar month, with over a third (35%) of ARLA letting agents reporting an increase in the New Year. On the other hand, Welsh agents only saw one in ten (11%) landlords upping monthly rent, leaving fewer tenants to battle with mounting costs.

Despite rent costs growing, ARLA letting agents said it takes approximately five viewings for a property to be taken off the market. In the East of England, where rent has increased the most, it still takes just an average of three viewings for a property to be let in the region, less than half the viewings it takes for properties in London (which takes an average of seven viewings).

Looking at things on a supply and demand basis, ARLA agents reported an average of 38 potential tenants registered per branch in January. This was, unsurprisingly, at its highest in London, with an average 45 registered prospective tenants per branch.

There is, however, much better supply in the rental market than in sales. The average number of managed rental properties per branch was 184, with the highest number recorded in the East Midlands (at an average of 266 per branch) while the lowest was recorded in London (at 140 on average per branch).

“London has the highest demand for rental property on average per branch, yet supply in the area is the lowest out of any UK region,” David Cox added. “Many Londoners simply cannot afford to buy and therefore look to the private rented sector instead. This means available property is highly sought after, and it highlights the issue of supply and demand; particularly in the capital but also throughout the UK.”