Rentals are on the move

Autumn Property Survey

IF YOU want someone to mow your lawn and someone else to organise a man who can fix your washing machine when it breaks down, then you should consider renting rather than buying your own home.

You get no tax relief and no chance of making a killing if the property market takes off. In the long run it may still be cheaper to take on a mortgage. But renting offers convenience and mobility, and can be as hassle- free as you want. You do still need to pick your landlord with care, however, and scrutinise the fine print of your rental agreement.

The explosion in the rental market over the past three years, particularly of serviced apartments (where the company you rent from takes care of the problems) has been driven by the new breed of young professional whose job demands flexibility. A recent survey revealed that up to 50 per cent of all prime tenants now are in their thirties.

In Europe the young and salaried do not consider buying a home until they want to settle down and bring up a family. And in the United States your job prospects are closely tied to a willingness to move. This trend has taken longer to infiltrate Britain, but as the economy has evolved over the last 10 years, ownership now comes much later in people's lives.

Renting used to be associated with luxury service apartments and seedy bed-sits and difficult landlords, with little in between. It was what you did when you could not afford to buy, and the supply of rented properties was shrinking steadily because landlords were reluctant to create sitting tenancies.

The Government reacted by introducing the 1988 Housing Act, designed to create a more flexible arrangement between tenant and landlord by reversing the trend towards regulated rents and security of tenure that had discouraged landlords. At the same time, would-be vendors who could not sell had the opportunity to let, knowing that vacant possession would be obtainable at the end of an assured shorthold - which in turn increased the availability of rented property.

The private rented sector is still small compared with local authority housing and owner/ occupation, accounting for 10 per cent of housing stock, but it is forecast to grow to up to 15 per cent in another 10 years - and not just in the prime London market.

Rob Thomas of the investment bank UBS said: "It seems to be a national trend. Up until five years ago you would not have seen a property to rent anywhere. London used to be the only place with a decent-sized rental market but the rest of the country is now just as good."

"The market has fundamentally changed," says Paul Mugnaioni of Quality Street, a company that specialises in high-quality serviced accommodation. "The whole structure of people's lives has changed. People need the flexibility to move around with their work - not a millstone around their neck, particularly if they have had to deal with one or two redundancies already before they hit 25."

Quality Street, which was launched in 1987 in partnership with Nationwide Building Society, now has shops in Aberdeen, Glasgow, Manchester, Bristol, and north and south London. It has around 5,000 properties on its books, half of which it owns. Gross rental income amounts to about pounds 22m a year and it owns gross assets of around pounds 150m. It even builds some of its properties from scratch, benefiting from local grants. Its appeal lies with its total service approach. QS will fix your washing machine and mow your grass if that is what you want.

You can rent for periods from a month to 10 years, and what you pay depends on the time you want to stay and whether or not you choose a furnished or unfurnished flat.

As the market has evolved it has become more sophisticated and is attracting financial institutions that view it as a realistic investment. Kleinwort Benson Development Capital recently completed the pounds 44.2m funding of the London & Henley group, aimed at acquiring, refurbishing, and letting central properties to cash in on the boom. Ian Grant of KB says that he expects L&H to grow significantly over the next few years.

Start your day with The Independent, sign up for daily news emails
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Digital Optimisation Executive - Marketing

£30000 - £35000 per annum: Recruitment Genius: The UK's fastest growing, multi...

Recruitment Genius: Financial Reporting Manager

£70000 - £90000 per annum: Recruitment Genius: A Financial Reporting Manager i...

Recruitment Genius: Payments Operations Assistant

£23000 - £25000 per annum: Recruitment Genius: They win lots of awards for the...

Recruitment Genius: Telephone Debt Negotiator

£13500 - £20000 per annum: Recruitment Genius: This nationwide enforcement com...

Day In a Page

On your feet! Spending at least two hours a day standing reduces the risk of heart attacks, cancer and diabetes, according to new research

On your feet!

Spending half the day standing 'reduces risk of heart attacks and cancer'
Liverpool close in on Milner signing

Liverpool close in on Milner signing

Reds baulk at Christian Benteke £32.5m release clause
With scores of surgeries closing, what hope is there for the David Cameron's promise of 5,000 more GPs and a 24/7 NHS?

The big NHS question

Why are there so few new GPs when so many want to study medicine?
Big knickers are back: Thongs ain't what they used to be

Thongs ain't what they used to be

Big knickers are back
Thurston Moore interview

Thurston Moore interview

On living in London, Sonic Youth and musical memoirs
In full bloom

In full bloom

Floral print womenswear
From leading man to Elephant Man, Bradley Cooper is terrific

From leading man to Elephant Man

Bradley Cooper is terrific
In this the person to restore our trust in the banks?

In this the person to restore our trust in the banks?

Dame Colette Bowe - interview
When do the creative juices dry up?

When do the creative juices dry up?

David Lodge thinks he knows
The 'Cher moment' happening across fashion just now

Fashion's Cher moment

Ageing beauty will always be more classy than all that booty
Thousands of teenage girls enduring debilitating illnesses after routine school cancer vaccination

Health fears over school cancer jab

Shock new Freedom of Information figures show how thousands of girls have suffered serious symptoms after routine HPV injection
Fifa President Sepp Blatter warns his opponents: 'I forgive everyone, but I don't forget'

'I forgive everyone, but I don't forget'

Fifa president Sepp Blatter issues defiant warning to opponents
Extreme summer temperatures will soon cause deaths of up to 1,700 more Britons a year, says government report

Weather warning

Extreme summer temperatures will soon cause deaths of up to 1,700 more Britons a year, says government report
LSD: Speaking to volunteer users of the drug as trials get underway to see if it cures depression and addiction

High hopes for LSD

Meet the volunteer users helping to see if it cures depression and addiction
German soldier who died fighting for UK in Battle of Waterloo should be removed from museum display and given dignified funeral, say historians

Saving Private Brandt

A Belgian museum's display of the skeleton of a soldier killed at Waterloo prompts calls for him to be given a dignified funeral