People rent 'as uncertainty about house market grows'

More people are renting for longer as they remain uncertain about the future movements of the housing market, a new report suggest.

Figures released by the National Association of Estate Agents (NAEA) show that the number of people looking to buy a house in June decreased by six per cent as fears about the long-term stability of the housing market emerged.

This could be good news for landlords as it suggests that people could remain in rented accommodation until more certainty about the market emerges.

In addition, NAEA members reported that the number of houses for sale also fell by six per cent as sellers were discouraged by increasing interest rates and an uncertain market.

"The next few months are likely to be characterised by consumers being cautious due to uncertainty surrounding future economic movements and recent government changes," explained NAEA president, Stewart Lilly.

After the Bank of England increased interest rates earlier this month, Keith Astill, the managing director at UCB Home Loans, said that more expensive mortgages would encourage people to rent for longer.

"Ironically, people are renting for longer because it's more difficult to afford to buy, which is in turn providing a boost to the buy-to-let sector," he concluded.