According to The Modern UK Housing Market, a report commissioned by the National Federation of Property Professionals (NFPP), rents are predicted to rise by 10-15% in both 2008 and 2009.

The report expects these increases to occur as affordability problems continue and first-time buyers find that they are unable to make the first step onto the property ladder. Currently 56% of 30-34 year olds are able to afford a new-build flat. With the increase in desirable and well maintained property people are deciding to stay in the rented sector for longer as it offers them a flexibility that would not be available if they had a mortgage.

Malcolm Harrison, spokesman for the Association of Residential Letting Agents (ARLA), told PIN: “The report shows that rents are rising, aided and abetted by the credit crunch and the crisis in the mortgage market. There was already strong demand for rental properties and this is increasing all the time. Combined with this and the traditional counter cylindrical response to the credit crunch in the rental market, rents are now rising at a greater rate.”