The Q1 research from the Association of Residential Lettings Agents (ARLA) shows that insufficient supply of good quality property means that the private rented sector (PRS) is struggling to meet demand. With the PRS picking up the slack from the housing market, ARLA believes that the next Government must focus on averting the sector from crisis.
“More than two thirds of our agents have seen demand outstrip supply across the country – there simply isn’t enough housing stock coming onto the rental market. The Government’s move to help first-time buyers by raising the Stamp Duty threshold was a step in the right direction. Now we need to see tangible measures to support the PRS,” said Ian Potter, operations manager of ARLA.
“Investors need to be treated as businesses, with proper incentivisation to invest in and refurbish older properties. This will improve standards, help the environment with improving insulation, and encourage much-needed investment to help get the market back on its feet.
“Banks need to be told to be more flexible about the provision of finance for the buy-to-let sector which has fuelled the supply of good quality homes, and saved this government from an even greater housing shortage. Without these kinds of measures there is a serious risk that a shortage or rentals will create another form of housing crisis.”
The research, conducted among UK letting agents and landlords, shows that during Q1 2010, two thirds (59%) of ARLA member agents reported more tenants than properties available. This is a 50% rise on the last quarter (41%) and in Q3 2009 the figure was just 24%.
The speed with which tenants are snapping up homes to rent is also telling – properties are vacant for an average period of just 3.6 weeks, which is down from 4.2 weeks at the same point last year.