Landlords set for sustained rent growth

AFS Team·29 January 2020·4 min read
Landlords set for sustained rent growth

Landlords set for sustained rent growth

Landlords in the private rental sector across the UK will see sustained rent growth - much like they enjoyed in 2019.

The prediction comes from HomeLet who say rents have risen by 3.5% over the past year and are now at an average of £953.

When London rents are excluded from this figure, the average rent is £793 which is an increase of 3.97% over the last 12 months.

Tenants in London are paying 2.1% more than they did in January 2019, with an average rent of £1,630.

'PRS has conformed to the principle of demand and supply'

HomeLet's chief executive, Martin Totty, said: "It's been an interesting year for property and despite Brexit implications, the PRS has conformed to the principle of demand and supply."

"Rent price growth has since May 2017 been on an upwards trajectory and it has been driven by the regions outside of the capital."

He added: "There are several things contributing to the performance, including the Tenant Fees Act and a constriction in private rental stock supply as landlords left the market."

HomeLet monitors 12 regions and found that seven of them showed increases that were greater than 5% with landlords in Wales seeing a year-on-year rise of 9.7%.

Mr Totty said: "It's unlikely the trend will change any time soon with the balance between demand and supply remaining and it's reasonable to predict a period of rent price growth in 2020."

The biggest cause for deposit disputes revealed

Meanwhile, it has been revealed that the biggest cause of deposit disputes between landlords and tenants is lack of communication about the reasons for withholding a deposit.

The findings from Hamilton Fraser also found that the property's cleanliness and damage sustained by tenants are the next most popular reasons for deposit dispute.

The firm says that dispute numbers being filed by tenants to their mydeposits scheme has risen in the last three years.

62% reached the adjudication stage

In 2019, the firm recorded 9,323 cases with 62% reaching adjudication - that's down from 2018's figure of 64.7%.

A spokesman said: "The deposit return can be the cause of a great tenant-landlord relationship to sour and our research shows that the poor or lack of communication is the leading reason for this.

He added that improving technology as well as competition is boosting standards that will help protect both tenant and landlord interests.