Lack of new homes is pushing rental yields up

Buy-to-let investors in the UK may be interested to hear that a lack of supply of new homes is leading to a resurgence in the lettings market.

According to the Residential Lettings Survey from the Royal Institution of Chartered Surveyors, rents are being pushed higher by the imbalance of supply and demand, with the net balance of chartered surveyors reporting rising rather than falling rents reaching 30 per cent.

Furthermore, surveyors are confident that rents will remain popular, with 36 per cent of those questioned expecting the positive growth to continue.

"With sellers back in the housing market, supply has fallen back in the lettings sector. This is good news for landlords as rents are set to move higher in the coming months and yield returns are likely to improve," explained spokesman Jeremy Leaf.

"The news that buy-to-let specialists are beginning to lend again may also encourage investors to return to the market."

Earlier this year, the National Landlords Association reported that landlord confidence in the real estate sector was at its highest level since the end of 2007.

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