According to a new report from Sequence, the demand for rental property in the UK increased by 16% in 2014.
Nationwide, the number of new tenancies agreed also increased by an impressive 20% between November 2013 and November 2014.
The demand for rental property in London increased by over 50%, with the demand for viewings up by 28% over the same time period.
The rising cost of renting
The latest figures from Sequence show that the national average cost for renting a property (excluding London) was up by 3% to £706 in the year to November 2014.
Stephen Nation, Head of Lettings at Sequence commented, “Rents have increased 3% annually across the UK to £706, driven up a 16% rise in demand and a 15% fall in supply of rental properties in the last year. This divergence has seen competition for each rental property sky rocket, with six applicants now vying for every new rental property.”
The report further highlighted the demand for rental property in the capital, showing that the cost of renting increased by 4% to £1,522 in London.
“In London the picture is even more acute. Demand is up a considerable 55% on the year while supply has actually fallen 4%. There are more than nine tenants chasing every rental property to come onto the market and this competition has caused rents to rise 4% annually to £1,522,” Nation stated.
Buy-to-let demand to remain strong
With so many first-time buyers unable to climb onto the first step of the property ladder due to rising prices and the tightening of lending, the demand for rental property across the UK is set to continue throughout 2015.
Good news for buy-to-let property investors, Sequence’s latest findings anticipate that rents will continue to rise in line with demand.
“Demand is set to continue to rise, with would-be buyers priced out of the sales market and the UK population continuing to grow, so I would anticipate price will continue on this upward trajectory in 2015,” Nation added.