Yields and new letting instructions rise at record levels

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by Gill Montia

The Royal Institution of Chartered Surveyors (Rics) has published a quarterly survey on the rented sector showing that 29% more chartered surveyors experienced a rise than a fall in new landlord instructions, in the first three months of the year.

The ratio compares with minus two per cent in the previous quarter, indicating that the housing market downturn is leading those compelled to move house to let their properties rather than attempt a sale.

Turning to tenant lettings, 28% more chartered surveyors reported a rise than a fall, up from 17% in the previous quarter.

According to the Rics, gross yields rose at their fastest rate since the survey began in 1999.

Twenty-three per cent of surveyors reported a rise in gross yields, compared with 5% in the final quarter of 2007.

The outlook for yields remains strong and this is encouraging landlords to remain in the rental sector, despite the difficulties of the credit crisis.