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Brexit: Residential rental demand remains unaffected by Brexit, moves up in August

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The demand for rented homes went up in August despite a fall in supplies at the same time, a research by Association of Residential Lettings Agents (ARLA) shows. The research shows that the outlook for the market remains positive despite Brexit. Majority of letting agents say that the demand for residential rentals has gone up despite Britain’s decision to leave the European Union.

According to the data, there were 37 prospective tenants registered per branch on an average, which was 37 per branch too, on an average, back in June 2016. Although, figures from the first half of the year showed a fall in demand, figures over the past three months have shown an increasing trend.

In January 2015, the number of tenants per branch stood at 38, which came down to 31 in 2016. The figure was 37 in February, down from 40 in the previous year. The number of tenants per branch was 33 in March, 34 in April, 33 in May, 37 in June and 36 in July, which showed a consistency in the market. In the meantime, there was a decline in the number of rental properties available with the letting agents. The figure of average number of properties per branch was 183 in August, slightly down from 184.

There was a change in the willingness of probable tenants to pay the stated price. The period from the start of last year saw an increasing number of prospective tenants negotiating for reductions in rent prices, which reached the highest in August. According to data, 3 per cent tenants succeeded in negotiating rentals, compared with 2.1 per cent in the previous month.

Although, there was uncertainty on the part of those looking to rent as well as the property owners, there was no real effect of the referendum result on the different aspects of the property sector, such as the rent prices, property supplies, and demand for rental properties. 12 per cent of the ARLA members reported an increase in rent price, 11 per cent noted a decrease, and 72 per cent reported no change in rent prices. In terms of supply, 16 per cent said supplies have increased, 17 per cent reported decrease, and 63 per cent said there has no change in the figures. 17 per cent reported an increase in demand, 12 per cent noted decrease in demand, and 67 per cent no change.

It has come up that Brexit did not have the impact on the market it seemed during the times of uncertainty after Brexit. The demand-supply in the sector is balanced. The best part is that those looking to rent and the property owners or agents have been able to negotiate deals successfully which means that the market is seeing a move towards better affordability for those looking to rent, especially in big cities like London, which is a positive indicator for times to come.

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Paul

The author Paul