Residential rents may rise by 15 per cent in the next five years owing to decrease in the number of properties entering the lettings market in the UK.
A latest report from RICS expresses concern over the fall in the number of new instructions from landlords to let their properties. According to the RICS, instructions coming through to agents has dropped again (a net balance reading of -22 per cent). This is the 21st month in which the feedback has pointed to lower supply of rental properties coming to market and this trend is impacting the rent.
“The Rent Expectations series is pointing to a cumulative average rise of around 15% over the course of the next five years,” RICS said in the report.
In fact, the Rent Expectations series is pointing to further modest increases over the course of the next 12 months with the deteriorating imbalance between demand (which remains solid) and supply (which remains weak) underpinning the trend beyond this time horizon.
The situation in the Private Rented Sector in the UK is no different. The latest trend gives great cause for concern as the supply continues of rental homes to drop, RICS observed.
UK needs more homes to rent, that many continue to exit the market, says RICS