We've just had the clearest sign yet that the property market has slumped - Relocation, Relocation has been axed by Channel Four.
The UK property market took another big blow this week. Channel Four is reportedly axing Relocation, Relocation.
Self-styled property gurus Kirstie and Phil - long practised in the art of home deal-making - have refused to make any more episodes of the show which helped people already on the property ladder to buy again. Apparently, they said it was hard enough for people to buy one house these days, let alone two!
The alternative
If the prospects for buyers are really as bad as Kirstie and Phil think – and let’s face it – a lot of us have got used to heeding their advice – is long-term renting any better?
For many people, the answer is probably not. I believe that the biggest problem for tenants is that most private rental agreements are assured shorthold tenancies, which operate largely in the landlord’s favour.
You might be safe in your rented accommodation for the length of the tenancy, usually a year, but if you want to stay on after that you may face difficulties. You could easily be asked to leave by the landlord and then face all the hassle of finding somewhere else to rent. Not easy if you have furniture and kids in tow.
Rental demand
Added to that, rents currently seem to be in an unrelenting upward spiral largely due to the increasing demand for rental accommodation. In London, for example, there are 9 people chasing every room for rent.
On top of that, a recent survey by the Association of Residential Letting Agents suggests that the private rental sector is nearing capacity, and that the length of time tenants stay in rental properties is rising all the time. The average period is now 19 months!
As it gets harder for folk to finance a purchase, demand for rental properties will inevitably rise even further.
Abroad
If you think, I’m being unduly negative, take a look at what it’s like to rent in many European countries.
For starters, it can be much cheaper to rent across the channel. According to the cost of living index at Expatistan, rents in Madrid are 31% cheaper than London and in Berlin they are 51% cheaper.
What’s more, our European neighbours don’t just beat us on price: when it comes to the law protecting tenants, they are streets ahead of the UK.
Spain
In Spain, long-term tenancy agreements usually last for 12 months but instead of being turfed out after that period, tenants in Spain can automatically renew the agreement for up to 5 more years. What’s more, the landlord is only allowed to increase the rent in line with inflation. It’s also a lot harder to be evicted.
Germany
German law is even kinder to tenants. Tenants have security of tenure, are assured about rent rates and are protected against unfair behaviour by landlords.
It’s a similar situation in France where there’s even a law prohibiting eviction from rental accommodation during winter months.
Near Capacity
I’m sure that most tenants will love the sound of these regulations, but of course, landlords may see things differently. And if the regulations are too tough for landlords, the supply of private rented property in the UK may actually fall.
So it looks like there’s no easy way to improve things for long-term tenants. Perhaps Phil and Kirstie’s next show should focus on helping tenants get the best possible deal…
What do you think? Would you be happy to rent rather than buy? Have you been forced into the private rental market? Tell us your experiences in the comments box below.
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More: Landlord and tenant showdown | Cheaper to buy than rent