One of the country’s most prominent housing market indices says the current imbalance between supply and demand in the rental sector is the consequence of “many years of landlord disincentivisation.”
The Home index, produced monthly and including a summary of the rental market as well as sales, includes useful figures for those wanting a snapshot of the lettings landscape.
Its latest index, released over the weekend, says: “Rents continue to rise overall. The mix-adjusted average annualised rise for the UK stands at 11.4 per cent. Supply remains tight in the face of overwhelming demand.
“This is undoubtedly the unintended consequence of many years of landlord disincentivisation through increased taxation and regulation. The levelling up agenda has, ironically, made it even more difficult for renters to get a foot on the property ladder while rising rents gobble up any spare cash they might have had.
“Meanwhile, the HMRC is clearly the main beneficiary, along with local councils and their costly yet mandatory registration schemes.”
In his commentary accompanying the snapshot, Home director Doug Shephard says: “Rents are already rising very quickly and therefore fuelling inflation, chiefly due to a lack of supply.
“Raising the cost of borrowing for landlords will have the inevitable results of 1) raising rents even further as the costs are passed on to tenants and 2) disincentivising investment in the private rental sector thereby making a difficult undersupply situation much worse.”
Home highlights the largest rent rises over the past year - they are all in London.
Bexley, Kensington and Hillingdon have seen annual rises of 42, 33 and 30 per cent respectively.