The Surrey Rental Market by SurreyLets
According to ARLA (Association of Residential Letting Agents) The supply of rental homes has risen “astronomically”, from the lows seen earlier this year. The jump in availability is likely to have contributed to average private sector rents remaining unchanged in September, ending a near six year run of rising prices, according to the Office for National Statistics (ONS).
But despite rents being flat month-on-month, they were still 2.3% higher than they had been a year earlier, meaning they are rising at nearly four times the rate of inflation.
Across Surrey, the fact that rents have been holding steady in September is likely to be due to the increase in supply, giving landlords less scope to hike their rents.Its a known fact that if a landlord keeps rentals the same then tenants will stay but they more than often leave when the landlord puts the rental up.
All areas of the UK saw rental increases during the 12 months, with the South East leading the way with a hike of 3.5%. Sally Asling, Lettings Director at online letting agency SurreyLets comments “At SurreyLets we are aware of continual rental increases year on year for tenants, however most investor Landlords look at the cost of replacing a tenant which can often offset and rental increases should the tenant leave due to a rental increase. Therefore our rental increases whilst modest are still within, if not more than, the average increases seen in the South East.”
However despite more stock being available than earlier in the year, there is still an overall shortage of properties available, therefore potential tenants are likely to face an increase in competition for properties and more rental increases.
Whilst across Surrey, agents have seen who had been Landlords have been holding off committing to further Buy-To-Let investment following a multitude of tax disadvantages coupled with Brexit continue to invest. Additionally the fears that landlords would exit the sector in the face of a wave of tax hikes had not yet come to pass.
Landlords are facing a raft of tax changes including the higher Stamp Duty rate introduced in April, a reshuffle of mortgage interest tax relief next year and an end to the 10% annual ‘wear and tear’ allowance for those letting furnished properties.These tax rises have prompted concerns that the UK could face a significant shortage of rental homes.
The Royal Institution of Chartered Surveyors (RICS) recently warned that 1.8m new rental properties were needed just to keep pace with growing demand. SurreyLets director, Sally Asling concurs.
“Whilst ARLA have reported an increase in stock, there is still a shortfall in stock given the demand. In the key areas we cover which is predominately the affluent commuter belt areas in East and West Horsley, Effingham, Bookham and villages in the Guildford to Leatherhead corridor, we are seeing an increase in rental demand as families looking to secure a home in the areas, to benefit from the outstanding schooling, are finding themselves priced out of the sales market. In these areas property prices have gone up a further 7% in the last year despite the market being quite stagnant following Brexit. There is no sign of the housing market dropping in value in these sought after villages, and families are struggling to get on the housing ladder. These families often seek employment in the city and need the quick commuter links, but like to live in these affluent villages. Rental is a viable solution but it has put an overwhelming strain on the private rented sector where there is a shortage of property available”
If you are thinking of letting your property in any of the areas above and would like a free, no obligation market appraisal of your property, we would be delighted to assist you. Our experienced staff can discuss all the options available to you and offer as much support as you need to guide you through the lettings process. Please contact Sally Asling, Lettings Director, SurreyLets on 01483 282470 or by email firstname.lastname@example.org
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