The stock of properties available to let across our network of 175 offices rose to new heights in early 2009 as house sales plummeted but has since declined. This has resulted in a genuine shortage of properties to let in most parts of the country where in certain areas, stock levels are down by 50% year-on-year.
This is having an inflationary effect on rents due to underlying tenant demand steadily increasing. In fact it has been reported that the number of tenants registered for private landlord accommodation is up by 30% since early 2009 which equates to ±5 tenants vying on average for each property as compared to ±3 a year ago! In St Albans this is most evident where demand from out of town tenants for 1 and 2 bed apartments far exceeds the supply.
We are also now seeing far fewer tenants giving notice and as a result the average tenancy is creeping up which is good news for landlords but not so good for letting agents! Lack of flexibility in the mortgage market and uncertainty about house prices and employment prospects are making tenants “stay put” and even within the sector tenants are reluctant to “trade up” to better located or larger accommodation.
A key milestone was passed at the start of 2010 when the number of households living in private rented accommodation was officially estimated at 14.2%. Only a decade ago the figure was 9% so we have witnessed a remarkable renaissance in the fortunes of this sector.
And to capitalise on this opportunity, an ever increasing number of Buy-to-Let landlords with multiple properties, have indicated that they will be expanding their portfolios over the next 12 months.
Richard & Merril Cleal, Martin & Co (St Albans)