Residential rents are expected to increase next year as the UK property market improves, according to a new survey.
The survey from Rightmove, a property website in the UK, showed that over one-third of people who plan to rent a property for the next 12 months expects the rental rates to increase, with only 7 percent believing that prices will drop.
Rightmove surveyed over 35,000 people in the property market and showed that 9 percent of them think that prices will increase by 10 percent; while another 28 percent predict that prices will rise by one to ten percent.
The latest Rental Market Report from the Royal Institution of Chartered Surveyors showed that surveyors expect an increase in rental prices next year because of the increasing demand over the past year.
The Rightmove Consumer Confidence Survey also showed that 58 percent of people, who will rent in 2010, would like to acquire property but can’t afford to buy. The highest proportion of this belongs to the South East, where 65 percent of renters don’t have the capacity to purchase property. About 28 percent of those who would rent in 2010 are likely to buy property at a later date, and only 12 percent will be renting for long-term.
Commercial director of Rightmove, Miles Shipside, said, “With sales prices now positive year-on-year across most of the country and low stock levels driving values up in many areas, 2010 may see many landlords cash-in by taking their properties off the rental market and put up for sale.”
“A limit in supply will exert further upwards pressure on rental prices. Demand for rental properties looks set to remain buoyant while property sales prices stay out of the reach of those tenants who would prefer to buy. On top of this, the restrictive mortgage lending criteria looks set to keep many would-be buyers trapped in rented accommodation,” he added.