The Royal Institution of Chartered Surveyors has given a brief but optimistic assessment of the private rental market for next year.
“As the sector continues to struggle with a lack of supply, the RICS survey data suggests rents will rise by 2.5 per cent. In fact, the number of new landlord instructions has been stuck in negative territory for 14 successive quarters, which is the longest run since 1999. In London, rents are expected to rise at an even faster pace of 3.0 per cent” says the institution’s forecast for 2020.
The RICS optimism is echoed in the longer-term forecast made by high end lettings agency Savills.
It says that in London, rents are set to rise ahead of wage inflation, growing a total of 18.8 per cent over the next five years.
“Affordability pressures in the for-sale market will continue to push demand into the rental market at a time of increasing pressures on private landlords, which have led some to exit the sector. New purpose-built, professionally managed homes for rent will help mitigate but not reverse this drain on supply” explains the agency’s main forecast document.
At a regional level, Savills says there will be less upwards pressure on rents with growth across the rest of the UK expected to average 13.1 per cent on average over the next five years.
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