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Tenants dig in their heels over more rent rises

Tenants dig in their heels over more rent rises

Category: Buy To Let

Updated: 07/03/2012
First Published: 07/03/2012

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Rental prices increased at a slower rate in the early part of the year as some tenants began to resist the sharp rises in rent levels seen in recent quarters.

Rental prices continued to increase across the UK , with a net balance of 13% of surveyors reporting rises.

This is down from 21% in the previous quarter and actually the slowest rents have risen for two years.

The Royal Institution of Chartered Surveyors (RICS) said that its figures suggest that prospective tenants are less willing to pay increasing rents.

And while demand has also held up, the body said that more first time buyers are looking to beat the stamp duty deadline on 24 March, slowing the pace of rental growth.

In addition, with rental growth beginning to slow in many areas of the country and a recent upturn seen in prospective buyers of property, an increased number of landlords are looking to sell at the end of a tenancy agreement.

Four per cent of landlords chose to place their property on the sales market in the three months to January, a significant increase from the previous quarter's reading of 2.6%.

The slowing pace of expansion in the market is expected to continue, say surveyors; 14% of respondents predicted rises rather than falls in prices, down from 24% in the previous quarter.

"With many potential first time buyers having been forced into rented accommodation due to problems with obtaining affordable mortgage finance, rental prices have grown quickly across much of the country in recent times," said Michael Newey, spokesperson for RICS.

"However, it seems that tenants may be becoming less willing to meet increasing rental values.

"While still growing, demand from potential tenants is also beginning to slow. With a recent upturn in buyers entering the sales market prior to the expiry of the stamp duty holiday in March, it seems that those who are in a position to get a foot on the property ladder may have chosen now to do so."

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