Rental Demand to Continue to Rise
This is according to Martin Totty, chief executive of the Barbon Insurance Group, who has discussed the issue in light of HomeLet's latest Rental Index, which shows UK rents grew 7.5 per cent in May on an annual basis.
The average cost of a rental property in the month was £846, compared to £787 in May 2013. East Anglia was the region that saw the biggest increase, with rents growing 10.7 per cent to £758.
Mr Totty stated: "There is every reason to expect that demand for rental property will continue to rise."
However, he said the exact reasons behind the increase in rents and demand for properties are not clear.
"What we don't know is if it's increasing incomes driving the increase in rents or if the rental market is attracting new renters who may be opting to rent rather than buy, either through preference or as a result of the recent sharp increase in house prices."
According to HomeLet, the average rent for the first three months of 2014 was 6.1 per cent higher than 12 months earlier.
Mr Totty said HomeLet's figures are good news for buy-to-let investors and this steady growth compares favourably with the fluctuations seen in house prices. He also suggested more rental properties could soon come to market, particularly if pension-savers choose to take advantage of annuity reforms by investing in the sector.
The industry expert added an increase in demand would be welcome news for the growing number of people who rely on the rental market for their home.