Tenant demand and rental levels accelerated in the quarter to July, driven by a strong economy, declining accessibility and immigration from EU accession countries, according to the Royal Institution of Chartered Surveyors (RICS) in its residential lettings survey for Great Britain.
30% more chartered surveyors reported a rise in rental levels, as demand growth exceeded supply growth, up from 20% in the last quarter. The rise in rents for the quarter to July was the strongest in the survey's history, almost four times the long run average. Surveyors report that immigration from EU accession countries (government estimates stand at 427,095 since EU expansion) has put further upward pressure on rents in some regions.
25% more Chartered Surveyors reported a rise than a fall compared to 19% in the last quarter with an ever strengthening economy and declining accessibility for first time buyers driving tenant demand higher. Tenant demand in London accelerated at the fastest pace since Q4 2000 with rents rising at the fastest pace in the survey's history, driven by a strong corporate sector and migrant labour.
RICS spokesperson Jeremy Leaf commented: "Economic prosperity and population migration have increased rental demand pushing up rents, making conditions better for property investors. However, first time buyers will find it hard to enter the housing market with higher rents making it difficult to save sufficient sums for a deposit."
