October 25, 2011
Buy To Let Landlords See Demand Increasing
The unprecedented demand for rental accommodation has pushed up the price of the average rent in the UK and buy to let landlords have been able to increase their rental prices to record levels.
This demand, says tenant eviction and referencing company Landlord Assist, will remain strong and continue well into 2012.
MD Graham Kinnear explains that since the start of the recession the buy to let sector has witnessed a surge in demand as many would-be buyers have struggled to get on the property ladder due to the strict lending criteria imposed by lenders and the challenge of raising large deposits.
He believes the buy to let market will remain strong for the foreseeable future for landlords as the fragile economy is continuing to put off many would-be buyers from making such a huge commitment as purchasing a property.
Kinnear said: “Demand for rented properties is showing no signs of slowing down. The slow growth in the UK economic recovery has meant people are still wary about committing to something as huge as a mortgage and are turning to rented accommodation instead.
“At the same time rising unemployment levels, which have reached a 17 year high, have left many people worried about losing their job and with the cost of living also rising this is putting off would-be buyers from thinking about buying a house.
“Higher living costs are also hindering the efforts of many tenants to save for mortgage deposits whilst they are renting so many are extending their tenancy agreements for longer than they initially envisaged. This makes it a win-win situation for landlords.”
But he warns it’s not all good news for landlords. Despite the buoyant market conditions, rising rent prices have led to an increase in rent arrears and landlords need to be aware of the growing possibility of tenants defaulting on payments.
