RICS: Rent expectations on the rise as new instructions fall
RICS residential lettings survey (November 2009 - January 2010)
HONG KONG, March 18 /PRNewswire-Asia/ -- The supply of new properties coming on to the rental market has fallen for the second consecutive quarter bringing an end the downward trend in rents that has been in place since the autumn of 2008, says the latest RICS Lettings Survey published recently.
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The net balance of chartered surveyors reporting rising rather than falling rents in the three months to January 2010 was zero. This follows five quarters of negative readings, and is in marked contrast to April last year when 58 percent more chartered surveyors were reporting falling rents, an all- time low for the survey. In addition, expectations as to the outlook for rents continue to strengthen with a net balance of 33 percent of respondents believing rents will rise over the coming quarter (up from 22 percent).
The more positive picture for rents can be attributed to the continued decline in supply of both flats and houses in the marketplace. 23 percent more chartered surveyors reported a fall rather than a rise in the number of new landlord instructions for this period, up from 18 percent in the previous quarter. Although the weather may have been a factor in this, it is more likely that the upturn in the housing market has tempted many of the accidental landlords away from the lettings market.
Demand remains strong with 16 percent more respondents still seeing it rise than fall. Would-be first-time buyers, unable to get a foot on the property ladder still, are a major source of increasing demand for good rental properties. Houses remain more popular than flats and it is the supply / demand imbalance in this market that is also helping to push rents higher.
RICS spokesperson Jeremy Leaf commented:
"It is becoming clear that movements in the housing market are heavily affecting lettings: RICS housing survey has steadily been seeing an increase in the number of new instructions coming on to the market over the past few months, whilst simultaneously we see with this survey that the number of properties available to rent has decreased. This is a clear sign that the accidental landlords are returning to the sales market. If demand remains strong, which it is likely to as many first time buyers are still finding themselves priced out of the housing market, then rents should continue to rise as would-be tenants compete for less properties."
Focusing on local issues, David Faulkner, RICS Hong Kong Chairman said:
"In Hong Kong the number of residential units available for letting has fallen and landlords are starting to increase rents. The limited supply of new residential units caused sale prices to rise significantly in 2009 as a result of which rental yields are at record lows, and renting is an attractive option for people who cannot afford to buy at current prices."
Notes to Editors:
The RICS Residential Lettings Survey began in 1998. This quarterly survey provides a comprehensive picture of the lettings market across England, Wales and Scotland as well as a regional breakdown.
The survey includes trends in tenant demand, gross yields, rent expectations and average monthly rents broken down by region and property type.
If you would like to download the full report, please click at the link below:
http://www.ricsasia.org/newsDetail.php?id=174
About RICS & RICS Asia
RICS (Royal Institution of Chartered Surveyors) is the mark of property professionalism worldwide. It covers all aspects of property, construction and associated environmental issues. RICS has 140,000 members globally and represents, regulates and promotes the work of property professionals throughout 122 countries.
The RICS Asia supports a network of over 11,000 individual professionals across the Asia Pacific region with an objective to help develop the property and construction markets in these countries, by introducing professional standards, best practice and international experience. It promotes RICS and its members as the natural advisors on all property matters. It also ensures that services and career development opportunities are provided to members.
The RICS Asia region covers national associations and local groups locating in Brunei, Malaysia, Singapore, Thailand, The People's Republic of China and the SAR Hong Kong. It also has members working across the region such as Bangladesh, Bhutan, Burma/Myanmar, Cambodia, Indonesia, Japan, Kiribati, Laos PDR, Macao, Mongolia, Nepal, North Korea, South Korea, Taiwan, The Maldives, The Philippines, Timor East and Vietnam. For more information, please visit: http://www.ricsasia.org .
Media enquiry, please contact:
RICS Asia Public Relations Representative
Ms Belinda Chan or Ms Ava Lau
Tel: +852-2372-0090
Fax: +852-2372 0490
Mobile: +852-9379 3045
+852-9829 2913
Email: [email protected]
[email protected]
SOURCE Royal Institution of Chartered Surveyors
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