Rental property market proving popular Published: 19/08/2008

The rental property market is booming in the face of falling house sales, new figures reveal.

According to a study by the Royal Institution of Chartered Surveyors, new instructions to let went up at their fastest pace ever.

It seems that property owners are choosing now to let out their property rather than sell it, which is proving increasingly difficult in the current climate.

Around 43 per cent of chartered surveyors reported a fall than a rise in landlord instructions in the past three months, compared to 35 per cent in the three months prior.

Some 47 per cent of surveyors reported a rise than fall in new instructions to let houses, while 39 per cent reported a rise in flats.

Rental yields are also going up at the same time, with demand falling in the property market as a whole.

Commenting, James Scott-Lee, said: "The lettings market is booming with many vendors opting to rent their property while sales in the housing market continue to dry up.

"Many are willing to "hold" and await the return of capital appreciation. Becoming a landlord is now an increasingly profitable option with rising rents and yields offering good returns.

"Established investors have been reaping the benefits of the housing downturn for sometime and will continue to do so in the short term. However, ever increasing supply could have an impact on rental growth as tenant options increase."

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