The latest report from the Association of Residential Letting Agents has suggested that the rental market has stayed relatively stable following last month’s Brexit vote.
Referendum reality
In the aftermath of the decision to leave the European Union, there has been very little movement in terms of rental costs.
12% of letting agents reported a fall in rent, while 77% saw no change.
Prior to the vote, 19% of agents suggested that rents would increase, with 20% expecting them to drop. 61% thought that they would stay the same.
Supply of available properties and housing demand has also stayed fairly constant since the referendum. 67% of ARLA members have reported no change to supply, with 64% saying that there has been no change in the number of tenants looking to secure a rental property.
This said, 45% of letting agents have seen uncertainty from landlords looking to let, which could cause problems in the coming months.
Calm
David Cox, managing director of the Association of Residential Letting Agents, noted, ‘the rental market has responded to Brexit in a calm fashion, with no immediate fallout amid extreme political and economic uncertainty. What we need is some certainty from the new Government that housing remains a priority with the rental market playing a central role. For example, we want to avoid a situation where institutional investors start pulling away from the market, because ultimately this will impact tenants by squeezing supply further and pushing up rents.’[1]
‘Although we’ve seen some hesitation from landlords this is relatively mild and it’s importantly they do not act in haste. Any inevitable longer-term changes will then be taken on board with greater ease,’ he continued.[1]
Rental market stays stable post Brexit
Monthly rises
On a month on month basis, demand for rental accommodation was up during June. In addition, the supply of properties managed on agents’ books also rose. There were 37 would-be tenants on average registered per ARLA branch in June, up from the 33 recorded on average in May.
The supply of rental properties increased by 3% in June, from 171 in May to 176.
Cox concluded by stating, ‘if one thing is clear following Brexit, it’s that supply and demand remains a real issue in the rental market. If supply continues to dwindle against growing demand, no matter what the eventual implications of Brexit are, renting will become more difficult and expensive for tenants.’[1]
[1] http://www.propertyreporter.co.uk/landlords/rental-market-survives-storm-brexit.html