Gloucestershire’s letting agents are currently experiencing soaring demand for good quality rental property. Thankfully the supply of property has so far been fed by the transfer of houses, flats and apartments from the more sluggish sales market. Whether based in the South of the county in towns such as Stroud, Tetbury, Nailsworth and Cirencester or in the northern towns of Cheltenham, Tewkesbury and Gloucester City, agents find themselves busier than ever.

The ability for supply to meet demand is however unlikely to last forever and already national statistics shows a steep increment in rental values and yields. In some areas of the country rent is up by as much as 12% compared with just one year ago. Many landlords are rubbing their hands together with glee as they see their rental yields climb toward a pleasing 6.5%, which is a high of over two years. Although Gloucestershire may not be quite at the top of these national statistics yet, there is little doubt that it will be within months. Actually the initial glut of sales properties appearing on the market actually brought down the rental on some properties during the last quarter of this year, so no doubt many local landlord will be pleased to here the trend is now set to reverse.

More than one property investor has begun to eye up the lettings market again, having put their chequebooks firmly back in their pockets as the slow down in the economy manifested with the credit crunch. The difficulty in getting buy-to-let mortgages brought about by the problems in the financial markets, and indeed doom filled predictions of property prices, had driven most of these folks away. The lower property prices and higher rents have meant though however that buy-to-let is starting to look desirable once more. In one recent survey 74% of landlords questioned stated they would buy more property if they spotted a good deal, both in terms of property price and supporting financial products.

Recent studies released by groups such as the Smith Institute, in regards to the lettings market in the future, have been extremely encouraging. They better my own predictions for the market significantly, the five years of significantly increased demand in the sector is depicted as being more likely to go on for anything up to twenty years. Supposedly by 2021 we will see one in every five new build homes going straight to the lettings market. In a turn around to previous criticism of buy-for-let investors, this area of the market will be seen as incredibly important and beneficial to us all in terms of the provision of necessary affordable housing.

Unlike the excessively steep curve of the rise in property purchase prices, rental rises have remained very much in line with income. This has meant that even those who could afford to buy have in many cases chosen to rent as it means they can enjoy a more fulfilling life style thanks to the extra cash left in their banks every month. It is wrong to assume that those who rent are forced to do so, over 25% of tenants are earning well over the national average salary at £30K+.

There is no doubt however that as the rental market becomes a greater matter of focus for government, and indeed for the average U.K. family considering a move, that a far greater emphasis will be put on professionalism. A combination of public outcry, and Government recognition of current failings, will mean new legislation in, and greater scrutiny of, the lettings process. I predict that cowboy agents and dishonest landlords will find themselves rapidly squeezed out of the market. Good riddance to them says us all.

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