Industry News


Bills included becomes ‘most searched for term’ and renters double search area


Analysis from the UK’s biggest property website Rightmove reveals the effect the rising cost of living and record rents are having on people searching for a new place to rent. People looking for ‘bills included’ has


jumped up to the top position for renters using Keyword Sort, a Rightmove tool where people can prioritise their property search results by choosing specific terms. It has overtaken those looking for pet


friendly homes for the first time, and is now also a higher priority than gardens and garages. Last year, bills included was just outside the top five. Many people are also contacting agents


about available rental properties across a much bigger area than four years ago, to have a better chance of finding somewhere available within their budget. Hybrid working is also a likely factor as many


people have more flexibility about where they live. Te average area renters are searching and contacting agents in has expanded from 70 km2 in July 2018 to 137k m2 currently. While the number of new rental properties


coming onto the market is slowly increasing, there is still a huge imbalance between demand and supply with total available rental properties remaining 25 per cent behind this time last year. Te result is a fiercely competitive and fast-


moving rental market, with prospective tenants seeing properties being snapped up twice as quickly as they were two years ago. Rents continue to reach new records, with


the average asking rent outside London now standing at £1,126 per calendar month, 19 per cent higher than two years ago. Tim Bannister of Rightmove, said: “People


looking for a new place to rent are casting their net much wider than before, in the hope that it will help them find a suitable place that they can afford. Although it’s not as constrained as it was a few months ago, the number of homes is still nowhere near enough to meet demand from tenants. “Te lack of homes is down to more people


choosing to stay put and sign longer contracts, some landlords selling up due to more onerous taxes and others taking advantage of record house prices, and hybrid working shiſting some demand to more rural and suburban pockets of Great Britain. Tis has all led to a fiercely competitive rental market in many areas with agents reporting that in some cases properties are being rented out in just a few hours.”


Impact of proposed rent cap criticised across the sector


L


andlord representatives have warned that a rent cap will mean less investment in new houses and their existing housing stock,


while a housing charity has called on tenants to refuse to pay any rent increases at all. As part of an impact assessment carried out


by the Department of Levelling Up, Housing and Communities ahead of the consultation, civil servants looked at all of the cap options and the impact they would have. Analysis of the impact of the 5 per cent cap


(favoured by the Government) estimated that social landlords would receive £1.3 billion less in rent next year, compared to if no change was made. Looking forward five years, housing associations would see £4.9 billion less and local authorities would have £2.4 billion less. Without any compensatory payments from


Government, this would force social landlords to make substantial cuts to planned works and services to tenants, as well as other budgets such as for staff salaries. Tenants warned that any rent cap was


inadequate, because it would not stop rents from increasing and it did not apply to rises in service charges. Instead they called for a complete freeze on rents. “Between 3 and 7 per cent is not enough,” said


Suzanne Muna, the secretary of the Social Housing Action Campaign, who stressed tenants were also facing rising food, fuel and other costs. “Tis would still be a huge problem for tenants who can’t absorb a 3 per cent increase.” SHAC said that housing associations could absorb inflationary costs and do not need to pass them on to tenants and residents. Te campaign said that even before the


Covid pandemic and the cost of living crisis, rent arrears among housing association tenants and residents were building at a steady rate of about 10 per cent annually. Between March 2018 and March 2021, rent arrears grew from £591m to £704m. It


8 | HMMOctober/November 2022 | www.housingmmonline.co.uk


is calling on tenants to refuse to pay any increases in rent. Social landlords said the cap would mean tens


of billions of pounds less would now be invested in social housing stock at a time of rising public concern about safety and conditions in some estates. Te cost of building new homes rose 12 per cent in the year to June and repair costs are up 14 per cent, they said. In a joint statement, James Jamieson, chair


of the Local Government Association and Kate Henderson, chief executive of the National Housing Federation, said: “Councils and not-for- profit housing associations are very concerned about the impact rising living costs are having on social housing residents. “Housing providers have been carefully


considering their approach to next year’s rents and will do all they can to keep increases low where possible. Working with partners, councils and housing associations will continue to do what they can to protect people from hardship, targeting help at people facing the most complex and acute challenges. “We are very concerned that a new cap on


social housing rent increases will significantly impact on housing providers’ ability to provide critical services for residents and invest in new and existing homes. “Decisions on the level of rent increases for


tenants need to be made by housing providers within the existing government rent policy commitment, ensuring that there is a careful balance between affordability for tenants and investment in the homes that they live in. “If the Government does take forward a


lower cap, then it should provide additional funding for 2023/24 and for future years so that housing providers can continue to safeguard services and meet the country’s future housing needs.”


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