Rental market goes from strength to strength

The rental market will continue to go from strength to strength over the next 12 months according to the latest results from the Assetz Lettings Survey.

The survey, which asks lettings agents in six major UK cities for their expected % change in rents over the coming year, shows that city lettings agents across the country expect modest growth of less than 5%, with the highest expected growth being in Bristol and Manchester (4%) and the lowest in London and Liverpool (1%).

London rents have performed the best over the last 12 months, increasing by an average of 9%, however these remain 2% lower than pre-recession rental values. The higher than average increase can largely be attributed to the current lack of rental stock in the capital pushing up values.

Lettings agents in Manchester expect rents to increase by 4% over the next 12 months, having remained stable over the past year. However, rents in the Northern city remain 3% below pre-recession levels.

The rental market in Leeds has outperformed other major cities in the last three years, with rents currently 10% higher than pre-recession levels, and 5% growth in the past year. However, agents expect the rate of growth to slow in the coming 12 months to a modest 2%.

Stuart Law, Chief Executive of Assetz, comments:

“The rental market has suffered over the past few years of economic turmoil, as the knock-on effects of falling house prices in the sales market meant that many of those unable to sell instead rented out their properties, causing an oversupply in many cities. However, as the sales market continues to show positive annual growth and with all of the major indices on a consistent upward curve, it seems that these ‘accidental landlords’ have left the rental market, correcting the stock levels in these cities and helping to push rents up once again.”