Rising rents resulting in an increased need for guarantors
By Emma Martin, 12 June 2018
New data from HomeLet shows that rents are continuing to rise across the UK. Its latest rental index shows a 2% rise across the UK between May 2017-2018, with the UK average rent now £919.
Whilst 11 out of 12 regions surveyed experienced rises, London was hit particularly hard, with increases of 5.6% across the year, equating to a staggering £84 hike in monthly rent fees.
The rise in rents has been put down to changes in stamp duty and tax which have left many landlords with tighter margins than expected. In an effort to counter these policy changes a large percentage of landlords have been forced to pass the cost on to tenants.
But new data from guarantor service Housing Hand has revealed that tenants are struggling more than ever to keep up with rising rents as they continue to outpace wage increases. The figures from a recent survey indicates a huge increase in applications over the last year, with student applications up by 60% and working professional applications up by 156%.
Jeremy Robinson, Managing Director of Housing Hand said: “Unfortunately, a growing number of students and young professionals are struggling to secure rental accommodation, as they cannot provide a guarantor or are failing credit checks.”
“With rising rent prices and deposits, many students can’t afford to put down several months of rent upfront.”
And unfortunately for the growing pool of tenants in the UK it seems as if things are unlikely to improve any time soon, with the Royal Institution of Chartered Surveyors (RICS) anticipating rises of 3% each year for the next five years, overtaking increases in house prices.
If you’re looking to streamline your property portfolio find out how much your buy-to-let is worth in seconds here
The tenancy deposit cap has been reduced to five weeks rent
Will a current trend of rent reductions last into the future?
The government has proposed a new Housing Court to streamline dispute resolution in the rental sector - what benefits will it bring?
Energy efficiency standards are improving and landlords need to be aware of their responsibilities
The rise of short holiday lets seems to be affecting rents in the UK