Why are rent prices going up?

The rental market in Bedford, like many other areas, has been greatly affected by the COVID-19 pandemic. In this blog, we will take a look at some of the issues that have arisen in the rental market and how they are impacting both landlords and tenants.

Supply and Demand Issues

One of the most significant issues in the rental market in Bedford is the supply and demand imbalance. Due to the pandemic, many people have been reluctant to move, which has led to a shortage of available rental properties. This, in turn, has driven up rents, making it more difficult for tenants to find affordable housing. 

Rising Interest Rates

Another issue that has impacted the rental market in Bedford and nationally is the rise in interest rates. Many landlords have taken advantage of the low interest rates over the past few years to expand their property portfolios. However, as interest rates rise, the cost of borrowing also increases, which has lead to higher rents for tenants.

Lack of New Landlords Entering the Market

Another factor contributing to the supply and demand issue is the lack of new landlords entering the market. With the pandemic causing uncertainty and economic instability, many potential landlords are hesitant to invest in rental properties. This has further reduced the number of available rental properties and driven up rental prices.

Rent Increases

As demand for rental properties increases with rising costs it was inevitable rents would increase, which have been a major issue for many tenants. With wages remaining relatively stagnant, it can be challenging for tenants to keep up with rent increases, leading to financial difficulties and housing insecurity.

Demand for Co-Living

One trend that has emerged in the rental market in Bedford is the increased demand for co-living spaces also known as Houses of Multiple Occupation (HMO). The HMO model is based on individuals share living spaces and amenities, such as kitchens and living rooms, while having private bedrooms. This model has become more popular in recent years, with people looking for more affordable and communal living options. However since the introduction of Article 4 there has been a significant drop in the number of new HMO's entering the market. 

In conclusion, the rental market in Bedford has been significantly impacted by the COVID-19 pandemic. The supply and demand issue, rising interest rates, lack of new landlords entering the market, and rent increases have all made it more challenging for tenants to find affordable housing. However, the demand for rental properties shows that there is potential for new and innovative housing models to emerge providing the local & national policies support the private rented sector (PRS) & landlords. 

Written by : Mujahid Ali 05/04/2023