Cost of renting rises by more than 4%, says survey
The cost of renting has risen by more than four per cent over the last 12 months, according to a survey published today.
The Royal Institution of Chartered Surveyors says rents have risen 4.3 per cent between July 2010 and 2011. This is in line with inflation. The average increase in the retail price index over the last 12 months is also 4.3 per cent, peaking at 5.6 per cent last September and dropping to 2.8 per cent in June.
The figures appear to further undermine a claim by prime minister David Cameron in January that the government’s welfare reforms are leading to rent reductions. They also contradict claims by housing minister Grant Shapps that rents are falling in real terms because increases are less than inflation.
Surveyors also say they expect rents to increase by 3.9 per cent over the next year.
Peter Bolton King, global residential director at RICS, said: ‘However, it is clear that we have seen rents grow steadily right across the UK for some time. This is partly down to the problem of the scarcity of mortgage finance and the large deposits required by lenders. These barriers to home ownership need to be addressed alongside the shortage of new stock coming to the market.’
RICS did find however that demand for private rental property is continuing to grow but at a slower pace than previously.