Rental property demand remains strong

In June 2018, referencing firm HomeLet said that Wales was alone among the regions in seeing rents decline annually, amid a background of rental growth remaining below the rate of inflation.

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Regional growth in the rental sector

Figures quoted by the firm demonstrate that rents were raised by 1.8% annually to an average of £924 per month, under the current inflation rate of 2.4%.

While growth plateaued in the south-east, Wales alone saw a yearly fall to £603 a month (down 0.8%).

The highest year-on-year rise was found in Northern Ireland, up 5.1% to £641 monthly.

Rents on a monthly basis were raised by 0.5%, growing in 10 regions out of 12, with a 4.1% increase to £689 notable in the West Midlands.

Rents in Wales fell on a monthly basis to £603 by 0.2%, while the north-east experienced a drop of 0.8% to £529.

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The chief executive of Homelet, Martin Totty, commented that he believed there will be many factors to bear in mind in the private rented sector over the next quarter. This includes both supply and demand for properties having an impact on average rents.

Government taxation changes squeezing private landlords have yet to be announced, he pointed out, and more regulation is in the pipeline that may also discourage private landlords from taking part in this important sector and start to reduce supply.

He said that a squeeze on the number of rental properties available will not be beneficial for tenants if it results in rents increasing. However, demand for properties to rent remains high, and in the near term, it is likely to be positive for property owners.

Totty mentioned that while some landlords may decide to sell up, many others view the situation as a chance to improve their yields. Demand still outstrips supply, a fact that many participants in the several government consultations have broadcast.

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