July 12, 2010 | Author

Author Julie Hanson

A falling supply of homes in the private rental sector has pushed up rents, according to a new index.

Findaproperty.com’s rental index for the second quarter has revealed that prices went up by 2.3 per cent.

This means that rent prices are £19pcm higher than they were in the first three months of year.

However, rents are still below pre-recession levels, with the average rent £34pcm lower than it was in the first quarter of 2008.

Yields are likely to continue rising, as more young people – now constituting just under half of households in the private rented sector – are delaying their first steps onto the property ladder.

Commenting on the figures, Findaproperty.com’s property expert Nigel Lewis said: “Landlords, many of whom rode out the downturn watching rents plummet as unwanted sales stock was offloaded onto the rental market, will be cheered and its tenants who are now facing a painful market.”

While this is good news for property investors, many are still unable to access buy-to-let funding to take advantage of the expanding sector.

Posted by Royston Hunter