Lettings Market Booming

43 per cent more chartered surveyors reported a rise than a fall in landlord instructions compared to 35 per cent in the previous quarter. Equally both new instructions to let houses and flats increased at the fastest pace in the survey's history with 47 per cent and 39 per cent more chartered surveyors reporting a rise than a fall respectively. Surveyors report that frustrated vendors have been placing their property on the market to let as they have been unable to agree sales due to a lack of demand in the housing market.

37 per cent more chartered surveyors reported a rise than a fall in tenant lettings, up from 30 per cent in the last quarter. Significantly, demand for family homes remains stronger than for flats. Many would be buyers have been forced to rent as the route to mortgage finance has been blocked. 43 per cent more chartered surveyors reported a rise than a fall in demand for houses compared to 34 per cent, who reported a rise in demand for flats.

Rents have continued to rise while house prices fall, driving gross yields upwards. Rising profits have kept landlords committed to the market. The proportion of landlords opting to sell at the expiry of the tenant lease fell to 2.1, the lowest level on record from 4.2 percent. Rental expectations fell slightly with some surveyors expecting over-supply to push rents downwards in the next quarter.