October 2009 seems to be what could be a turning point for the property rental market. In 2008 rents started to fall across most of UK with rents in some locations, such as within central London, seeing rents achieved fall by 10%. But now the supply-demand is starting to change.
From 2008 there have been many factors causing a fall in rents:
- Properties not able to be sold placed on the rental market creating over-supply
- Some young adults moving back in to live with parents to save money
- East European immigrants moving away from the UK
- Affordability, the recession was hitting everyone’s pocket.
But in 2009 new factors are starting to play into the supply-demand equation:
- The initial impact of properties for sale coming on the rental market has largely been absorbed
- New build has slowed down dramatically, leading to an increasing shortage of properties.
The impact has seen the rental market start to recover with companies such as Findaproperty reporting a reduction in properties available to rent by as much as 10%. Additionally increases in rents have been reported, averages across UK are up 0.1% in October and 1.2% in London.
It is early days to see if this is the start of a recovery in rental prices but it is looking like positive news for landlords in the months ahead.
