Overall 70% of tenants state the current market favours landlords while 55% of tenants identify themselves as ‘trapped renters’ who would like to buy but can’t afford to.
Rightmove said there is evidence of long-term demand as a third of tenants expect to be renting for three years or more and one in five tenants has been in their current property for five years or longer.
The property website said the gulf between rental demand, as measured by search activity, and supply, measured by available properties for rent, is at the widest point ever measured.
Search activity keeps setting new records having more than doubled over the last two years whilst available stock for rent is down by nearly 10%.
The website said the stark statistics clearly illustrate the extent of the growing accommodation crisis in Britain, as well as the investment opportunities for landlords to help alleviate it.
Miles Shipside, director of Rightmove, said: “Attention investor landlords: now, more than ever,
your country needs you!
“As well as potentially earning a good return on your investment compared to other asset classes, private landlords can help provide a long-term rented roof over a grateful tenant’s head.
“While hard-nosed rental investors may not welcome the appearance of too many new landlords if it results in downward pressure on rents, if you invest wisely it seems to be a genuine win-win of good rental yields for landlords and a secure stream of tenants paying a fair return.”
Without a significant increase in rental supply, there is the danger of a rental bubble in some parts of the country, Rightmove warned.
Tenants could end up paying too high a percentage of their disposable income on rent, and landlords could end up with arrears and voids rather than a secure long-term income-producing tenant.
Shipside added: “Six out of ten tenants forecast that their rents will be higher in 12 months’ time.
“This might be music to some landlords’ ears, but in reality it is the sound of many tenants crying for help!
“In areas where rents are close to their affordability ceiling landlords should be prepared listen and avoid a situation which results in voids and arrears.”
Lettings agents are taking differing views on the yield they require, the website reports.
They claim some investors are happy with a 5% rental return on the cost of buying the property, whilst others are willing to take more risks in looking for more aggressive returns towards 10% if there is little prospect of growth in capital values.
Shipside said: “If you’ve got money sitting in the bank and are looking to diversify into other asset classes then one option is to help out those that cannot buy but are desperately searching for a place to call home.
“However, budding landlords should take care as some investor clubs took advantage of inexperienced investors and irresponsible buy-to-let lending prior to the credit crunch.
“After that pain we now need a saner approach where those contemplating investing use all the research tools available and take advice from reputable lettings agents on local long-term housing demand trends.
“We will need the rented sector to be a mainstay of future housing supply, but where and what you buy must be based on thorough analysis of future demand rather than just jumping in to satisfy the current need.”
