Posts with tag: supply and demand

RLA & NLA: Increased Demand is Hurting Tenants

Published On: March 16, 2020 at 12:25 pm


Categories: Landlord News

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The Residential Landlords Association (RLA) and the National Landlords Association (NLA) have warned that the government is ignoring warning signs of a looming rental crisis. 

Tenant demand is increasing, but the number of new landlords entering the market is falling according to new figures released by the Royal Institution of Chartered Surveyors. What’s more, they say this has been happening every quarter since mid-2016.

This increased demand and squeeze on supply is likely to lead to rental increases across the vast majority of regions in 2020. This is already the case if you ask HomeLet, who say that rents are rising across the country, making it harder for tenants to save to buy their own home.

Landlords had hoped that Rishi Sunak’s budget last week would have shown support for them, but were sadly disappointed. 

They had called for Rishi Sunak’s big-spending budget to include the abolishment of stamp duty on the acquisition of additional homes where landlords invest in property adding to the net supply of housing such as new build properties or bringing long term empty homes back into use.

In a joint statement, the RLA and NLA said: 

“The government is undermining its own efforts to boost homeownership through its attacks on the private rented sector.

“By choking-off supply and making renting more expensive it is tenants who are hardest hit.

“Ministers need to wake up to the reality of the damage their tax measures are doing to the private rented sector and support landlords to provide the new homes for private rent we desperately need.”

Supply of rental accommodation slips further

Published On: February 25, 2016 at 11:51 am


Categories: Property News

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A worrying new investigation by the Association of Residential Letting Agents suggests that the supply of rental accommodation is at its lowest level since records began.

What’s more, demand for accommodation was up slightly in January.


Supply of rental accommodation slips further

Supply of rental accommodation slips further

After months of steady decline, January saw the number of properties registered per letting agent branch slip by 5%. The total currently stands at 172 properties, down by 10 on December 2015.

However, renters north of the border have much more choice, with 280 properties registered per member branch in Scotland. In London however, demand for property is being driven up by lack of supply, with just 116 properties available per registered branch.

Rising demand

Demand for rental property rose in January, following a lull in December. One average, 31 would-be tenants registered per member branch during the last month. This is still lower than in January 2015, when 38 tenants were registered per branch.

Growing demand was underlined by the number of agents reporting rent hikes in January. 30% reported a rise in rental values, the largest since September 2015.

‘Supply of housing continues to be a problem and tenants bear the brunt of this with more people competing for properties at higher prices,’ noted David Cox, managing director of ARLA. ‘The majority of tenants find that it is impossible to save very much at the end of the month to put towards buying their own home. Our recent Cost of Renting report found that a fifth of those renting in the UK do not expect to ever be able to afford to buy a home and unless we act soon to build more properties, this number will only get higher,’ he continued.[1]


The upcoming stamp duty changes on buy-to-let and second residential homes is causing concern in the sector. 63% of ARLA members believe the Chancellor’s reforms will drive landlords out of the market. This in turn will lesson supply still further, with 58% of ARLA members believing that reforms will also push up rental costs.

Mr Cox went on to say, ‘a few weeks into the new-year and the April deadline for the stamp duty surcharge is looming and interest from buyers looking to invest in buy-to-let properties and beat the deadline is ramping up. The final details of the new tax will be revealed at the Budget in March but we are not expecting to see the Government back down on this policy.’[1]

‘The findings from our members echo our concerns that efforts to penalise buy-to-let will ultimately impact those entering and currently in the rental market, as by increasing rents landlords will seek to recoup their costs. Rent costs are already rising exponentially and tenants are feeling the strain of a crowded marketplace. We just need more houses; it’s a simple as that,’ he concluded. [1]




New property listings fall during July

Published On: August 11, 2015 at 4:41 pm


Categories: Property News

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Data from a recent report indicates that new property listings fell sharply during the last month.

According to the latest Property Supply Index by online estate agent HouseSimple, the number of UK homeowners putting their property on the market dropped by 13.2% in July.


HouseSimple looked at the total number of new properties listed on Rightmove in July in comparison to June in excess of 100 towns and cities across Britain. In addition, all 32 boroughs in London were examined. The findings show that just one in six towns and cities saw new property listings increase during July.

New stock levels have then fallen in the majority of areas during July. Glasgow and Edinburgh in particular experienced huge drops of 30.3% and 29.7% respectively. Milton Keynes (28.2%) and Sunderland (28.1%) faired only marginally better.[1]

Swindon, which recorded a substantial 40.5% rise in new listings during June, saw them drop by 25.2% in July. What’s more, data shows that a quarter of towns and cities that experienced the largest fall in new listings were in the South West of England.[1]


A possible reason for the drop in new property becoming available could be the typical seasonal drop-offs in market activity during the summer months. However, stock has been low long before the summer arrived and particularly concerning is the fact that the much-expected post General Election rush never really materialised.

Figures from HouseSimple’s survey show that in London, supply for property is particularly low. New stock levels in London boroughs alone were down 14.9% in July. In Bexley , listings fell by 31.4% last month, while popular area Kensington and Chelsea saw new listings slide by 24.5%.’[1]

‘Any hope that sellers were finally returning to the market seems to have been a vain one for the time being,’ said Alex Gosling, CEO of HouseSimple. ‘A boost to new stock levels in June suggested that we were finally starting to see some movement from sellers, but that momentum seems to have been short-lived. The General Election, which the market hoped would provide a catalyst for sellers, is long gone and property stock numbers remain well below normal levels.’[1]

New property listings fall during July

New property listings fall during July


Gosling went on to state that, ‘why are homeowners not moving is the $64,000 question. Is it because they can’t afford to as property prices have risen out of reach of them? Or maybe they’re not confident about market conditions, despite the strength of the economy and the highly competitive mortgage rates on offer at the moment?’ He believes that sellers, ‘need to be encouraged back to the market because there are buyers galore waiting when they do. It’s a very attractive market right now for motivated sellers.’[1]

‘The next few months are going to be important as the property market looks to gather momentum heading into the last quarter of the year. We fully expected activity to drop off in the summer months, but come the Autumn the market needs to replenished with  stock to realign the supply versus demand balance,’ Gosling concluded.[1]




House prices rise monthly and yearly

Published On: August 4, 2015 at 3:24 pm


Categories: Finance News

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The latest residential Index from the Nationwide Building Society suggests that house prices in the UK continue to rise.


Data from the report shows that property values in Britain rose by 0.4% in July, and by 3.5% year on year. The monthly rise comes after a slight fall of 0.2% in June, taking the average UK property price to £195,621. Annually, growth has gone up from the 3.2% recorded last month.[1]

Robert Gardner, chief economist at the Nationwide, said that there are signs that annual house price growth may be levelling out close to the speed of earnings growth, typically around 4%.

Gardner said that if this were to be the case, ‘this would bode well for a sustainable increase in housing market activity, though whether this will be maintained will depend on whether building activity can keep pace with increasing demand.’[1]

Continuing, he stated that, ‘employment growth has remained relatively robust in recent quarters, and, after a prolonged period of subdued growth, wage growth is also edging up. With consumer confidence buoyant and mortgage rates still close to all-time lows, demand for housing is likely to firm up in the quarters ahead.’[1]


Despite the perceived positivity, Gardner conceded that he was unsure whether supply could eventually catch up with demand. He commented, ‘the number of new homes under construction has started to pick up, albeit from historically low levels, and further increases are required if a sustainable recovery in the housing market is to be maintained over the longer term.’[1]

Alex Gosling, chief executive officer of online estate agents HouseSimple, feels that property prices will continue to rise as demand grows faster than supply. Gosling feels that, ‘with strong employment, a rise in wage growth, and mortgage rates sticking at a record low, prices look like they’ll edge up further in the coming months.’[1]

‘The market desperately needs a boost in new homes if supply is ever to come close to catching up with demand,’ he continued. ‘But the spectre of an interest rate rise looms ever closer with expectations that the Bank of England will start raising them by the year end.’[1]

Gosling went on to describe the property market as, ‘an interest rate paradise,’ but feels that, ‘very soon, that will be a paradise lost.’ He went on to say that, ‘the extent of the impact of a rate rise on the market is a huge unknown.’[1]

House prices rise monthly and yearly

House prices rise monthly and yearly

Slow supply

Rob Weaver, director of property at residential investment platform Property Partner, believes that poor supply continues to hold back the property market. He noted that, ‘although demand is likely to drop off a little over the summer, easing house price growth, it is shaping up to be a solid Autumn, with prices set to rise more sharply as of September.’[1]

‘Sellers are likely to be in an increasingly strong position as the autumn progresses, although a cloud looms overhead in the form of a possible interest rate rise before the end of the year. Buyer demand and confidence remains strong right now, but an interest rate rise as early as December could see buyer confidence in the market ebb away very quickly. Even a quarter percent rise in the base rate could have a material effect on demand,’ he explained.[]

Weaver went on to say that more positively, ‘it’s encouragingly to see that buyers overall are paying less stamp duty and are shifting away from the traditional thresholds.’ He concluded by saying, ‘the clustering of old made for an artificial and ultimately restrictive market.’[1]

Prime problems

Jonathan Hopper, managing director of buying agents Garrington Property Finders also believes that with buyer demand and confidence remaining high, the rise of home values is being driven by low supply. He observed that, ‘the exception is the prime property market, which is still reeling from the rise in the top rate of stamp duty. While the Nationwide’s calculations show that the stamp duty changes have reduced price bunching and that most buyers are paying less of the tax, the top 2% are paying an average of £28,000 more per purchase.’[1]

‘With nearly half of all the stamp duty paid in England and Wales collected in London, this is having a substantial chilling effect on the capital’s prime property market. The stamp duty hike was supposed to gently apply the brakes to stop the prime property market racing away. But in the event its effect has been more of an emergency stop,’ he added.[1]



Supply of rental homes drops in May

Published On: June 25, 2015 at 4:21 pm


Categories: Landlord News

Tags: ,,


The total number of rental properties available for tenants in Britain fell during May, widening the concern over the gap between supply and demand still further.

Data from a report by the Association of Residential Letting Agents indicates that supply of rental property fell by 7% in comparison to April. This represented 179 properties per branch of letting agents who are members of the organisation.[1]

Capital concerns

Highlighted in the report are concerns for the capital. Surprisingly, London had the least amount of rental properties per branch, with just 134 recorded in May. This was in comparison to 273 properties in Scotland. [1]

More concern came with the news that despite rental properties decreasing, demand remained the same. ARLA said that 36 would-be members registered per branch during May, which was the same as the last two months.

Additionally, the report shows that during last month, 34% of ARLA agents recorded rent rises for tenants. This is in comparison to the 27% recorded in January. Those residing in the South West were most affected by monthly rent hikes, with 49% of agents in the region suggesting an increase.[1]

Supply of rental homes drops in May

Supply of rental homes drops in May


‘It is worrying to see that there is such as sharp decrease in supply, when we know there is already a struggle to meet housing needs,’ commented David Cox, managing director of ARLA. Despite agreeing that the months following the General Election were always likely to cause uncertainty, Cox believes that low supply and high demand are issues that will continue to plague the market.[1]

‘We are in desperate need of more housing stock in this country and supply and demand isn’t something that will level out overnight. It’s vital that the new government follows their promise of building more houses, so we can free up rental properties and head on the right path to turning the property market around once and for all,’ Cox added.[1]