Monday, Sep 24, 2007
Not sure which planet they're referring to
Firstrung: Tenant demand outstripping supply - ARLA
Not sure about our readers but all we see is vast swathes of empty new build flats in most city centres, perhaps ARLA forget to include this in their research. What next; buy to let players increasing rentals to match their mortgage payments?
Posted by converted lurker @ 12:51 PM (998 views) Add Comment
17 Comments
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1. dbnazz1 said...
What utter Bo*lo!ks. Is this the survival instinct kicking in.
2. Yes said...
I'm looking for a new place to rent (south west) and I have noticed more people going for the houses available and rents do seem to have increased, although this may be because students are looking for accomadation around this time of year therefore bumping up demand, who knows! unfortunately this story came as no surprise to me, as this is exactly what I myself have experienced.
3. Jimmytenner said...
Took the word out of my mouth - Bollo*!
4. benedict said...
How many BTLs are members of ARLA? Is it possible that the serious, established professionals are members and so are doing well, but the newbie idiots who've been conned into buying stupidly overpriced new builds aren't, so any survey is going to be fairly unrepresentative of the market as a whole.
Or they're lying bastards, they're both valid explanations, I was just wondering.
5. dohousescrashinthewoods said...
I think this has some temporary validy. STRs will be looking for rentals before the NE rot sets in so, there could be a blip in demand and, therefore, rents. Once NE is established, BTLs won't be able to sell their portfolios and STR will dry up as people are forced stay put count how many years of peonage they face. Gentle demand will come from those reaching the age where they need a property but refuse to buy, but this will be a much smaller stream than the current flurry of STR.
So I can see demand up for the next few months, (and BTLs licking their mortgage-squeezed lips) followed by a dearth of rental demand and BTLs going to the wall like flies to a windscreen because their compatriots dumped properties, driving down market value. Mass reposessions because BTLs replaced FTBs, so, for the same number of repossessed individuals there will be multiple properties per action. Suggests a sharp drop in purchase prices, followed by a long, deathly chasm decline whilst thousands of people remain pinned down by their mortgages.
About 20-25 years before the market starts to recover - the length of mortgages taken out in the last 5 years.
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7. Tulipmania said...
The BTLs often say that the effect of people getting concerned about a crash or higher interest rates can be positive as people sell to rent thus increasing rents. I think this is absolute tat (like most things ARLA et al say) as the effect of people selling to rent is surely minimal as they must compose such a tiny proportion of the population. Other than from this site how many STRs do you know? I know one, myself, everyone else I know has just bought or are trying to buy.
8. cyril said...
I am not surprised if there is a high demand for rented housing because there is an increasing population & more divorces etc. and people have got to live somewhere. Smug owner occupiers have more bedrooms than they need or second homes, meanwhile there is a chronic shortage of housing for everyone else.
City centre flats are often left empty deliberately, presumably because the tenants would wreck them (partly because they are so shoddily built), so this does not indicate lack of demand generally.
9. alan said...
The government may decide to delay the pain by temporarily cutting IRs. This is becoming more likely, unfortunately.
In the longer term, delaying the inevitable gentle price slippage could promote a quick crash. Our economy is not as robust as it once was - everything is highly geared, too highly geared in my humble opinion.
10. Still-waiting said...
Sadly there isn't much choice of private rented property where I live (Hampshire, SE)... yet.
11. dbnazz1 said...
Alan..
Economy not as robust as it once was..... in many peoples opinions, including my own, the robustness of the economy was only ever an illusion that was based on debt. The country at best only enjoyed a party today that was to be paid for in the future.
12. su said...
Maybe they're talking about planet Edinburgh. Since the SNP (Scottish National Party) came into power, the city council has come up with a fly plan to please both the homeless and BTL landlords. The landlords can now sign up to a 3-5 year lease and fill their properties with the homeless. OK, they get 10-15% less rent BUT the council pays the rent even if the property is empty! IMO this could be a fly plan concocted by the SNP to take over England where there will be a lot of unhappy landlords!
http:www.sundayherald.com/search/display.var.1708278.0.councils_scheme_to_provide_housing_for_the_homeless_proves_a_hit_in_edinburgh.php
13. tyrellcorporation said...
Su, the SNP are welcome to it!
14. Dave said...
Ian Potter ARLA Operations Director say that rents increase following a fall in houseprices? What? I would have thought that if houseprices had indeed softened (as they appear to have done since August) then this must imply some sort of reduction in demand. If there is a reduction in housing demand, then one would have expected a fall in rents and mortgage approvals to keep the ratio between rents and repayments broadly in balance. He says the opposite is true.
If there is indeed an inverse relationship between prices and rents, then shouldn't we have seen a massive fall in rents?
I question whether there is enough data to extrapolate to this assertion - note that houseprices may have only just gone 'soft'. I also question their motives.
As the earlier correspondant notes...bo!!@ks!
15. Bloo Loo said...
theres always been a shortage of decent rented property- eg 4 bed, but there a re tons of 2 bed flats for rent round here (essex) and loads more going up. I doubt that any new landlords are with Arla as they seem to be the AGENCY organisation, and I doubt BTLS landlords could afford 10% of their income going to a management co
16. Meltsheep said...
Rents have certainly shot up in N4 and N5 - keep an eye on the developments near Holloway Road tube, and around Finsbury Park. You;d expect a lot of places to be sitting empty but I don't see it.
17. su said...
Tyrell. You still keen on emigrating then? I tried living abroad for a while, but I got homesick.... and then there were the beasties...