Throughout 2010, Tenant demand was always outstripping the supply of properties coming into the rental marketplace, something that I blogged about at the time here. This had the effect of increasing rents throughout the UK, particularly in prominent cities in the south like London, Oxford, Exeter and Bath.
Rents have continued to increase in 2011 and Tenant demand is still very high, though there is now signs of more property coming to the rental market. ARLA’s (the Association of Residential Letting Agents) survey of the Private Rented Sector, covering Q4 2010, was drawn from 554 member offices and concluded that demand for rental property will continue to outstrip supply for much of 2011 and into next year. You can read their report here. Similarly the latest RICS (Royal Institute of Chartered Surveyors) Residential Lettings Survey for November 2010 – January 2011 concluded that strong tenant demand and a falling supply of property, is increasing rents rapidly. RICS report can be read here.
With such reports from ARLA and RICS and continuing demand, Tenants across the UK are bracing themselves for more rent increases. According to research by leading property portal Rightmove, more than half of Britain’s tenants expect the cost of renting to increase during the next 12 months, while only four per cent predicted falling rates. The property website said that the UK’s rental sector was “creaking under the strain” of increased demand, with almost 60 per cent of tenants eager to buy a home but financially unable to do so. Miles Shipside, director of Rightmove, commented: “Letting agents in many areas are reporting an insatiable demand, with prospective tenants coming from all backgrounds and requiring all types of property.
Tenant demand and increasing rent is very evident in Bath, particularly in the larger and more expensive properties that perhaps would not have come to the rental market only a few years ago. Reside recently let a beautiful and substantial three bedroom Georgian Townhouse on Lyncombe Hill for £3000 pcm after just a day on the market. Just outside of Bath we recently let Park House Farm, a large Grade II listed former farmhouse believed to date back to late 17th/early 18th Century for £2750 pcm and on Bathwick Hill, Reside achieved a rent of £2700 pcm for a detached modern home on St. Catherines Close.
It is not just the larger properties that are seeing an increase in rents, one and two bedroom apartments are the most in demand properties in the rental market in Bath and have also seen a dramatic increase. Reside recently achieved £695 pcm for a very small top floor apartment located on Princes Street in Bath city centre, £950 pcm for a beautiful one bedroom apartment on Henrietta Street and £1400 pcm for a contemporary two bedroom apartment on Catharine Place.
According to new research recently carried out by Lloyds TSB, house prices in spa towns across England and Wales are on average £38,000 or 16%, above their local averages. Properties in Bath cost on average 42% more than in neighbouring south-west towns. This coupled with Tenant demand means rents will continue to increase in Bath for the foreseeable future. Landlords – Now couldn’t be a better time to rent out your property.
