Rents are on the rise across the UK, squeezing tenants and reshaping the rental market. A major reason is the imbalance between supply and demand. More people are looking to rent, but there aren’t enough homes available. This competition pushes prices higher.
At the same time, economic conditions are making homeownership less accessible. Rising mortgage rates and tighter lending rules mean fewer people can buy, keeping them in the rental market longer. This sustained demand drives up rental costs.
The Impact on Tenants
For renters, affordability is a growing concern. The average private rent has increased significantly over the past year. In many areas, even key workers like nurses and teachers struggle to afford a one-bedroom flat. As rents rise faster than wages, more tenants are forced into shared housing or must move further from city centers.
How Landlords Are Responding
Landlords are also adjusting to these changes. While some of them are raising their rents to cover both higher mortgage costs, and property taxes, others are attempting to incorporate their properties into businesses in order to manage financial pressures. Meanwhile, government regulations and tax changes have made buy-to-let investments less attractive, discouraging new rental properties from entering the market.
What’s Next?
Many believe the rental market will likely remain under pressure with demand still outpacing supply by a considerable margin and rents continuing to rise at an unprecedented pace. While government policies that are aimed at increasing housing availability may help a bit, real and meaningful change takes time. For now, tenants have no option but to navigate a challenging market with few affordable options.
If rising costs and tax changes have you scrambling around to rethink and re-plan your entire financial future, maybe it’s time to look into or explore other overseas investment opportunities, such as QROPS, for example, that might be worth considering.