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June 9, 2008
Rental Market Booms as House Prices Drop
According to the Independent, demand for rental properties is at record levels as people delay plans to buy their own homes because of the downturn in the housing market.
The proportion of letting agents reporting that demand is outstripping supply is now at a high of 39 per cent, according to the Association of Residential Letting Agents (Arla), with the imbalance highest in Greater London and the South-east. The report echoes the findings of recent studies which have revealed a rental boom off the back of turmoil in the home-owning market.
The strong level of demand has led to a further fall in the average length of time a property is empty between tenants, falling from 24 days to 22 during the past three months. There has also been an increase in the average length of time tenants stay in a property, rising from 16.1 months to 16.3 months.
The Arla research, based on responses from 444 letting agents, found that it was not only first time buyers planning to sit tight and ride out the current downturn in the housing market. More than three quarters of landlords said they did not plan either to buy or sell in the near future.