New tenant applications reach record levels

Countrywide

Friday, January 21, 2011

The number of new tenants registering for rental accommodation exceeded 200,000 last year as demand reached record levels in 2010 [1]; report Countrywide, the UK's largest letting agent and property services Group.

The latest figures from Countrywide's network of 1,300 estate agency and lettings branches reveals that the overall volume of new tenant applications in 2010 increased by 37 percent compared to 2009 with demand peaking between July and September. In contrast the average number of properties available to let fell -29 percent in 2010 compared to the previous year.

Figures from Countrywide's mortgage division; the UK's largest mortgage broker; also show that the biggest growth area of lending growth in 2010 was applications for buy-to-let mortgages, with applications jumping 22 percent during 2010.

Grenville Turner, Chief Executive of Countrywide, the UK's largest property services Group, said;
"The continued challenges faced by homebuyers to gain mortgage finance is likely to see more people turning to the private rental sector this year. Despite the increase in buy-to-let lending, supply remains significantly lower than demand, with an average of 4.5 tenants vying for every available property in 2010.

"During 2009 there were 2.3 tenants for every available rental property, which demonstrates the upward shift in demand we're experiencing. This could soon reach critical levels as limited mortgage availability continues to stifle the market and the impact of the government's austerity measures on social housing and employment kicks in."

Grenville added:
"Despite the severe weather conditions, which accentuated the traditional seasonal slowdown, a new wave of committed house sellers registered their homes for sale during December.

"New sales instructions out-performed December 2009 levels by 2.6 percent - an overall increase of 9 percent during 2010 [2]. However, buyer enquiries fell 5 percent year-on-year, which could be attributed to the chronic lack of mortgage funding for those unable to afford a typical deposit of 22 percent. [3]

"We expect lending in the first half of 2011 to stay flat, which will intensify the dilemma facing thousands of buyers struggling to raise deposits and existing home owners considering to remortgage as pressure mounts for the Bank of England to increase interest rates."

Market Insight - December 2010
Mortgages:(based on the activities of the UK's largest mortgage broker with approximately 650 mortgage consultants)

Residential Lettings:(based on the activities of the UK's largest estate agency & lettings network, operating 1,300 offices)

Estate agency:(based on the activities of the UK's largest estate agency & lettings network, operating 1,300 offices)

 [1] Countrywide Residential Lettings (records began in 2003)
 [2] Countrywide Estate Agents: New Sales Instructions December 2010 v Dec 2009
[3] Countrywide Mortgage Services: Average deposit for Countrywide's Top 10 Mortgages applied for throughout 2010

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