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Tuesday, November 24, 2015

Less rent hikes in October says ARLA

The Association of Residential Letting Agents (ARLA) October Private Rental Sector (PRS) Report has been published.

It shows fewer tenants experiencing rent increases according, with letting agents reporting rent increases falling to 25% in October, down from 32% in September – and the lowest monthly rate this year.

The October rental market saw its seasonal drop in demand, with ARLA agents registering an average of just 33 new tenants, again the lowest monthly rate so far this year.

The London rental market continues to follow its own upward trajectory, with rental demand up in October – with an average of 42  tenants registering per branch, up from 39 in September. 

ARLA managing director, David Cox, commented on the October market survey: 

“Finally, some good news this month – fewer agents reporting rent increases should bring some relief to tenants before Christmas. It’s definitely a step in the right direction, however a quarter of tenants are unfortunately still seeing hikes.

Although it’s typical that demand dropped at this time of year, as there’s a seasonal lull in the run up to Christmas, we except to pick up again in January.

Looking ahead to next year, we’d hope to see the number of tenants experiencing rent hikes remain low with supply and demand levelling out. However, a lot is resting on the economic and political agenda. We’re still waiting for new houses, promised by the Prime Minister to be built. Whilst this will take pressure off the rental prices as supply rises, the changes to landlord tax proposed under the Finance Bill is likely to discourage new landlords from entering the market.

Further, it’s been a waiting game all year to see if Mark Carney will raise interest rates in the New Year – this will play a big part in determining whether renters looking to buy a home will be able to afford to. And when interest rates do rise, the goal of homeownership will be pushed further out of reach for many and of course put further pressure on the private rental sector.”

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