The Rent Check, a report which follows two years of accumulated rental data from BDRC Continental’s Landlords Panel, shows that even though the buy-to-let boom has grown the private rented sector by 13.9% since 2013, it still will not be able to keep up with the growing demand.
The report, a collaboration between BDRC Continental and Allsop LLP, provided a five-year outlook for the private rented sector, concluding that, despite the Conservatives pledge to build 200,000 starter homes by 2020, the pressure on the PRS will not be significantly reduced. Only 8% of landlords are looking to or expect to buy a new build property.
Although they predict that increasing demand will lead to rent rises in the short-term, the limits of tenant finances will force rents to remain affordable.
The research also tracked the experience of a large sample of National Landlord Association’s members over six months to provide a statistically robust overview of the rental market. 29% of landlords expect to buy at least one property in the next 12 months (up 2% since autumn 2014).
In the first quarter of 2015, 14% of landlords purchased a new property, and 38% reported an increase in tenant demand over the same period.
The study also found that tenants are staying longer in their properties, with the average tenancy length increasing to 2.7 years.