A weak housing market continues to fuel a letting boom, as demand for rented accommodation in July grew by 76% year on year, according to Your Move.
The UK letting agent says lease commencements were up by 18% in July 2008 compared to July last year, as thousands of would-be buyers scrap plans to get on the property ladder.
Meanwhile, the number of leases commencing January to July 2008 in total is up a huge 41% on the same period in 2007.
Compared to a normal year in which rental demand sees seasonal fluctuations, 2008 has seen continuous growth, Your Move says.
David Newnes, managing director of Your Move estate agents, comments: “The mortgage famine has pushed a huge number of buyers out of the market- they’re choosing to rent until the market returns to normality.
“Demand for rented accommodation has exploded; July’s massive uplift is the biggest this year. Normally summer sees a natural slowdown as people holiday rather than move house, but this year is bucking the trend.”
Newnes believes the huge boost in demand is being supported by the large number of properties coming onto the letting market.
“A lot of sellers won’t accept depressed prices; instead they’re taking advantage of booming demand for rented accommodation and putting their homes up for rent.
“Even those who can get a mortgage can see the advantage of renting in the current climate. From here on, the question mark over stamp duty means buyers will hold out before they put in an offer until they know whether there’s a saving to be made.
“House prices are under pressure at the moment, and there’s scope for buy-to-let investors with collateral to get good deals to expand their portfolios.”IFAonline
Paul Bruns and Elaine Parkes
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