Landlords hike rents after eyeing the competition
A number of landlords are increasing rents in order to keep in line with other landlords, suggesting a snowball effect in terms of the number of rent increases.
Almost three quarters of landlords (72%) agreed that keeping rents in line with their local rental market was an influential or very influential factor in their decision to increase letting prices, research from The DPS suggests.
Meanwhile 68% said that increasing costs relating to legislation and compliance were a key factor in their decision, with 62% mentioning increasing maintenance costs.
Matt Trevett, managing director at The DPS, said: “Demand for rental property remains high, and our survey suggests most landlords see a future in the rental market.
“However, landlords have also told us that their costs have increased recently, particularly as a result of higher interest rates – and it seems a large proportion are raising rents to cover their expenses.
“Clearly increases to interest rates and the cost of living will also be affecting some tenants, and we’d encourage both renters and landlords to have an open and constructive dialogue about financial pressures in the current economic climate.”
More than half (54%) said that the requirements of mortgage lenders, such as financial stress testing and affordability requirements, did not influence their decision, with 53% saying that increasing costs of letting agents did not affect their thinking either.