Rental properties could be scarce in future, warns ARLA |
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Sat, 17 Sep 2005 13:05
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LONDON - The Association of Residential Letting Agents (ARLA) has said that the demand for rental properties is huge and this demand is not being met by adequate supply. This has meant that buy-to-let rents have spiraled upwards in some areas in the country.
These findings were tabled in a report of the third quarter ARLA Survey of Member Letting Agents, which was released on Wednesday. These findings have also been echoed in the latest figures of house price index released by the Office of the Deputy Prime Minister. Around 436 ARLA member-letting agents across the country participated in the survey. ARLA said that the demand for these properties could cause a severe shortage of rental properties in the near future.
"This very healthy balance between supply and demand could well indicate that it may not be long before there is a shortage of property in the private rented sector. If we cannot maintain a degree of surplus capacity, the rental market could need additional property very urgently," warned Adrian Turner, ARLA Chief Executive.
The ARLA survey found that the value of rented houses increased by 3.8 percent in totality. Flats saw an impressive 5.8 percent rise in their value. The British capital saw a boom of 12.9 percent in house price value in some prime areas like central London. Almost all respondents in central London admitted that their rents have increased by 30 to 34 percent in recent times. "We believe these figures indicate that it is good quality property that is in demand and letting well," said Turner.
In the South East respondents said that rentals had increased by 29 to 31 percent, while the rest of the UK saw 35 percent of agents reporting a rise in rentals. "This quarter's report confirms what we expected, rising values in good quality rental property and rising tenant demand. This reflects both the softening of house prices and the shift towards renting. More people see renting as the socially acceptable flexible alternative to owner occupation," Turner elaborated.
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