Londoners are worried about the inflation and the after-effect of Covid19. In the UK, rents, energy bills, food rates, and gas prices have been increasing continuously to cause chaos and raising huge concerns. Also, people in the UK are returning to their offices and colleges. This is the reason for the increase in huge demand for rental properties over the past several months.

With the return-to-office trend resuming and rising rents in the UK, people are unable to decide whether it is good to move out or stay put.

What are the effects of rising cost of living in the UK?

Any inflation or crisis is the outcome of pandemic or governmental laws. You may find a shortage in affordable housing in the UK due to the less numbers of new homes being built against the actual annually required numbers. Also, the UK cities with huge tourist attractions have been facing more gaps between demand and supply.

The UK rental market has seen stiff competition and rise in rents but many landlords are showing patience with their existing tenants. You can request a free online rental valuation from City Borough Housing for your housing needs across London, Kent, and Surrey to maximise your rental income and reduce your landlord workload.

Some private rental companies are raising their rents or evicting their tenants to keep pace with the crisis. Some landlords have already sold their rental properties as they plan to exit the UK rental market due to the rising cost of living and high rents. The landlords have various reasons including strict property legislation and higher mortgage costs.

Recently, UK has created strong job markets and educational centres to attract foreign workforce and students. This has resulted in a huge shortage of properties to rent and hence the rents are sky high.

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Why are the UK rental markets soaring to record high?

The UK rental market has been impacted due to the cost-of-living crisis across the UK. Typically, rents are considered as the primary source of income for most of the people. You cannot blame landlords to the high rise in monthly rent. There are various socio-economic and legislative factors that have contributed to rental crisis.

Here are a few major factors to consider.

1. Mortgage rates

The loan interest rates have risen and so are the interest rates against your properties. Hence, the landlords of both residential and investment properties have to pay higher mortgage payments. To cover such high rising expenses, the landlords need to raise the rent.

2. Changes to tax rules

Recently, there are significant changes in the UK tax laws that have impacted landlords. The landlords are either forced to sell their rental properties or increase their rents to cover their financial and tax obligations. It costs landlords to comply with the current regulations.

3. Increased service costs

The cost of labour, materials, and other services have increased. The landlords need to spend for repairing and maintaining their properties. These costs are added to your rent. Landlords are also working to make their rental properties more energy efficient to avoid huge energy bills.