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The level of supply in the private rental sector in the UK is showing signs of improvement but there is still fierce competition for rental property as the level of demand remains high. Available rental properties have increased by 10% since the last quarter, according to the latest report from the Association of Residential Letting Agents (ARLA), and this should help ease demand. The average number of buy to let properties managed by ARLA licensed members increased in the last three months from 135 properties in the third quarter to 148 properties this quarter, although two thirds of ARLA members say would be tenants still outweigh available properties Members believe the number of landlords increasing their investment in buy to let properties was driving the improved outlook for supply in the private rented sector, with the number of landlords purchasing properties now exceeding the number selling their investments, a reverse on figures reported three months ago. Those landlords increasing their investment in buy to let properties rose from 27% to 30% in the last three months. Meanwhile landlords looking to sell their current buy to let investments fell 9% from 32% to just 23%. Although the increase in available buy to let property is a step in the right direction for the private rental market and good news for renters, the bad news is that demand still strongly outweighs supply. Some 65% of ARLA Licensed member agents said there were still more would be tenants than properties available on their books, a decrease from 68% last quarter, suggesting that the market could be heading towards a more level playing field. ‘This quarter we’re seeing promising signs that the market is taking small steps towards achieving a better balance between supply and demand, or at least it is easing slightly,’ said David Cox, ARLA managing director. ‘With more landlords investing in their portfolios, ARLA licensed members have reported a growth in supply, while the level of demand witnessed last quarter has fallen slightly. Of course, the market has a fair way to go in terms of completely balancing out,’ he added. The report says that the increase in supply is down to more investment in buy to let property; however a number of ARLA Licensed members also reported an increase in rental property coming back onto the market following failed attempts to sell, rising for a second consecutive quarter, from 16% to 24%. It also points out that as supply and demand levels ease, tenants are taking advantage of the slightly less competitive market as the number of would-be tenants haggling with landlords over rents increased from 32% to 35% over the past six months. ‘It’s great to see an increase in consumers making an active play to agree on rent prices. Letting agents should be able to help tenants to get the fairest deal, and to ensure the process… Continue reading →
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