Huge supply 'pushes rents down'
Tuesday, 18th November 2008

The flood of new landlords to the lettings market after the housing price crash has resulted in a large supply of properties, in turn pushing down the price of rents across the country, it has emerged.

Research carried out by the Royal Institution of Chartered Surveyors' (Rics') Letting Survey found that the balances of surveyors reporting new instructions to let both flats and houses had hit "historical highs", in turn indicating supply.

These landlords, Rics added, placed their properties on the market after they were unable to sell it at the price they desired, meaning thousands more rental properties had hit the market.

Explaining the situation, Rics spokesman James Scott-Lee commented that "the market place has become more and more competitive as many vendors have been forced to become amateur landlords, creating an inevitable downward pressure on rents where supply has matched demand".

Last week, Rics highlighted data presented by the Council of Mortgage Lenders which demonstrated the "squeeze" on mortgage lending, adding that house prices were likely to drop further over the coming months.