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Tenants predict rocketing rents

Monday, 7 March 2011 12:25 PM

Tenants across the UK are bracing themselves for further rent rises, as a challenging mortgage market keeps would-be homeowners off the property ladder.

According to research by 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.

"Those traditional tenants that are leaving the family nest are increasingly being joined by those that can't sell or get a mortgage to trade up, putting unprecedented pressure on the rental sector to provide homes to rent on most rungs of the property ladder.

"Such demand inevitably creates supply shortages and pushes up the cost of the rented roof over the tenant's head," he added.
Meanwhile, research by Zoopla revealed last week that renting a property in the UK now costs an average of 10.5 per cent more than having a mortgage.

It found that paying rent is now a more expensive option in 80 per cent of towns and cities throughout Britain, with Milton Keynes topping the list, with average rents in that area typically exceeding mortgage payments by 42 per cent.

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