Thu 22 May 2008
Rental yields on the up
A survey on residential lettings by the Royal Institute of Chartered Surveyors (RICS) has found that instructions to let property have risen by 29%.The survey, which monitored the quarter to April 2008, found that many homeowners who are struggling to sell their property are turning to the rental market to take advantage of rising rental yields.
The net balance of surveyors reporting a rise in gross yields is at the highest level in the survey’s history.
“The sales market’s loss is the lettings market’s gain,” said RICS spokesperson James Scott-Lee. “Some would-be sellers are retreating from selling and letting or re-letting their properties as they wait for mortgage lenders to offer buyers more favourable lending criteria. While transaction numbers in the sales market are weak, many are taking advantage of rising rents and yields in the private lettings sector. With rental expectations high, landlords will continue to enjoy this increasingly lucrative market.”
However, the British Property Federation (BPF) believes that rising rents could cause a new type of housing crisis.
“These figures highlight another impending housing crisis – soaring rents,” said Ian Fletcher, residential director for the BPF. “The private rented sector has housed half-a-million people since 2000 and it’s the most widely available source of affordable housing. If demand continues to rise while supply does not, those who can’t buy or access social housing will have nowhere to go.
“There is a desperate need to get more investment into rental housing. Large investors building new family homes specifically to let could be encouraged with minor planning and tax changes.”
Posted by Kate Hamilton
in British Property Federation, Ian Fletcher, James Scott-Lee, News, Royal Institution of Chartered Surveyors on Thu 22 May 2008
Have your say and comment on this article