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Landlords freezing rents as tenant incomes fall

Landlords freezing rents as tenant incomes fall
March 14th, 2013
Author: Economic Voice Staff

Three-quarters of landlords (74%) have frozen or cut their rents in the last year, new research released today by Shelter has revealed.

The study showed that just 26% of renters had faced a rent rise in the previous 12 months in a survey of 4,300 renters, the largest of its kind ever conducted. This is despite growing demand for rented homes, with over 9m people now renting their property from a private landlord.

The British Property Federation welcomed the figures, which reinforce that nationally rents are rising at the same rate as inflation, as measured by CPI, and at a slower rate than many other goods and services.

The data also suggests that the squeeze on family budgets is a more a reflection of cuts in benefits, stagnant incomes and a general rise in the cost of staple goods and services, with food and fuel inflation far exceeding rental inflation.

Shelter today used its data to argue for a “stable rental contract”, whereby rents would rise each year in line with inflation.

Ian Fletcher, director of policy at the British Property Federation, said: “These figures suggest that for most tenants, private sector rents are not rising at all, and official statistics show that nationally they are not exceeding inflation.

House for rent

House for rent

“Shelter’s stable rental contract has some good intentions, but it isn’t clear what impact it would have – for example, Shelter should clarify if it is calling for rents to be index-linked to RPI or to CPI. Even the difference between these two figures is very important because the consequences could leave millions of tenants or landlords financially worse off.”

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