Rics: Rents still on the increase

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Rental growth remains firm as people are turned off buying houses as the market slows down.

The latest lettings survey from the Royal Institution of Chartered Surveyors (Rics) found that demand for rented property in England and Wales continued to increase during the three months to October, although it moderated compared to the quarter before.

According to Rics, 20 per cent more surveyors recorded an increase in demand rather than a fall for the three-month period. This was down from 28.5 per cent in the previous quarter.

Rics believes that the pace of rental growth will slacken in the near future, while still being strongly positive.

"A combination of the tightening lending criteria and successive interest rate rises has started to hit the buy-to-let market but with the drop in capital gains tax due in April next year, many landlords will resist selling until the spring,"said Rics spokesperson Jeremy Leaf.

"With rents still on the increase many would-be-buyers will find accessing the housing market even more difficult as they struggle to raise the capital for that first important purchase. However, many landlords will still take solace from uncertainty in the economy and enjoy the gains from rising rents."

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