Letting agents upbeat

Letting agents are feeling more positive about the future of the private rented sector of the property market than they were 12 months ago.

According to Homelet, a tenant referencing service and landlord insurance provider, agents are optimistic despite the ongoing mortgage drought which has affected buy-to-let particularly badly.

Homelet carried out a survey in December 2009 which showed that 98% of agents expect the lettings market to stay the same, grow or grow substantially over the course of 2010.

That figure is a 12% increase on January 2009, and is in line with the results of the latest research carried out by the Association of Residential Lettings Agents (ARLA).

ARLA revealed that the surplus of rental property is reducing, while demand for rental properties is rising, resulting in a surge of ‘reluctant tenants’.

During Q4 2009 41% of members reported that there were more tenants than properties – compared with just 24% in Q3 2009. In addition, ARLA research among landlords revealed that 54% of those asked felt that consumers were being forced to rent rather than buy.

The imbalance between supply and demand is likely to push up average rents, which is great news for landlords and letting agents alike.

Managing director of HomeLet John Boyle said:

“Demand for rental properties will remain strong over the next few years as first-time buyers continue to find it difficult to obtain mortgage finance.

“Confidence in the buy-to-let market is also likely to be buoyed by figures released by LSL Property Services which showed gains of 7.6% in the private rental sector over the last 12 months, and a gradual increase in buy-to-let lending as the year progresses.”