Quarter of landlords expect rental growth over next six months

 

A new report has revealed landlords’ sentiment towards the private rented sector and what the outlook might be for the months ahead.

Around 24% of landlords who took part in the latest barometer, conducted by buy-to-let consultancy BDRC and Allsop, said that they anticipated an uplift in rents over the next six months, while 41% believed the future strength of their own portfolios was “good” or “very good” for the next three months.

The report – The Rent Check Summer 2018 – also revealed that 38% of landlords believe rents in the areas where they operate are currently rising, although this is 15% lower than the number who said the same thing last year.

How rents perform across the UK

On a regional basis, the annual rental change is highly dependent on location. For example, between the fourth quarter of 2017 and the first quarter of 2018, when landlords were interviewed for this part of the survey, the average rent for a two-bedroom flat in central London decreased by £111 annually to £1,680 per consecutive month. The east of England also saw a fall of £37 a month compared to the previous year.

Meanwhile, the south-west recorded the strongest growth of £35 a month, while the West Midlands saw a £23 rise and in the north-west rents increased by £22 a month for a two-bedroom flat.

Growth of demand and supply

Over the past five years, says the report, rents across the board have tended to track inflation across all regions and for all property types, while demand and supply have risen at a similar rate. However, there is now some evidence that while demand continues to increase with more people renting for longer before buying, the provision of rental housing is falling behind, leading to a gap.

This could partly be down to some of the new difficulties being faced by landlords over recent years implemented by the government, such as stricter lending rules brought in by Prudential Regulation Authority, with two-thirds of landlords saying it is now more difficult to get buy-to-let lending than it used to be.

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Quarter of landlords expect rental growth over next six months

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