Demand for rental properties 'outstrips supply'

Demand for rented property outstripped supply in the last quarter, causing incomes to rise, a new report suggests.

Data gathered by ARLA showed that rental levels rose in the three months to the end of May, making it the fourth quarter running where rental incomes have increased across all property types.

As a result of increased demand, the average time a rental property stands empty has also fallen - the typical void period is now just 24 days.

In central London in particular, agents reported that demand for housing is far higher than the available supply. In fact, seven out of ten central London agents said that there are now more tenants than properties.

"There is a shortage of all forms of housing in this country and these results show that the shortage of good quality property is also apparent in the rented sector," explained Adrian Turner, chief executive of ARLA.

ARLA's report also showed that the typical rented property in London was now worth £885,000. Away from London and the south-east, the average value of a rental home is £229,900.

Official figures from the government suggest that the average property in the UK was worth £209,454 in April.