The economy has taken a swing and hit renters straight on the chin by rising to rates higher than ever seen before. Britain’s biggest lettings chain, Your Move, revealed that an average tenant is paying 689 pounds a month and in London an even higher 1,000 pounds per month. This amounted to many seeing 4 to 6 months of their yearly salary going toward rental fees.
The mortgage problems in the UK housing market are forcing families to rent versus buy. Many are finding a majority of their income going towards leasing of a property and little left over for expenses. This results in very few being able to come up with the required deposit necessary to purchase a home.
Despite the high number of homes on the market and the lowering of house process there just aren’t enough buyers available to make a difference in the housing market. Without new buyers entering the market, current homeowners cannot sell their properties to upgrade. There doesn’t seem to be any change soon on the horizon so the market will continue to suffer. This is unfortunate that so many are finding it hard to buy when homes are at such affordable prices and mortgage loan rates are at all-time lows.
Due to the inability of many to purchase, the demand for rental properties are high which is leading to the increase in rental process. Across the country the increase in rental costs is 3.1 per cent higher than it was last year.
David Newnes of LSL Property Services said: ““Landlords have seen tenant demand continue to hit new heights. The mortgage market remains tight and many buyers simply cannot get the finance to get a foot on the property ladder.
“And with potential spending cuts on the horizon, and uncertainty over the direction of the economy, many buyers are choosing to remain in rented accommodation for longer.
“As a result, demand for rental accommodation is increasing, and supply is not rising fast enough to match it.”