Renting pays off
With the credit crunch raging on and property transactions at an all time low, more and more people are turning to rental - either renting their properties out if they are proving hard to sell in the current market, or renting a property themselves instead of buying...

Traditionally, renting has been largely associated with student digs or overpriced house shares in your twenties when you never know who you are going to find on your sofa the next morning.

Many people see rent money as dead money- flushing away their hard earned cash to pay off someone else's mortgage. It is also seen as a temporary fix, living in a property you can't make your own - a house you can't turn into a home.

Now, thanks to the current market conditions, experts are predicting that the desire to own a home of one's own may fade and renting will become the preferred option.

That way, it is far less responsibility-you don't have to worry about market conditions as you are not responsible for selling the place or for maintaining it.

It is also likely that you could get a nicer property for your monthly rent than you could if you were looking to buy.

The credit crunch has forced many who were looking to sell their home to hold back until the financial climate improves and those looking to buy are finding it hard to get the necessary credit.

As a result, the number of rental properties available on the market has increased dramatically, as has the number of prospective tenants.

The Royal Institution of Chartered Surveyors (RICS) said instructions to let properties increased at their fastest pace since its survey began during the middle of this year.

Almost half of surveyors polled reported seeing a rise in the number of new landlord instructions, compared to just 30 per cent last year.

Private renting was already growing in popularity back in 2005 to 2006, when the Department for Communities and Local Government found that there were 2.5 million people renting from a private landlord at the time.

This year has seen tenant demand rise at its fastest rate for a decade, with the demand for family homes particularly strong.

This could be attributed to the new breed of tenants - less student or young professionals and more families - who may have sold their home and are looking to rent whilst they sit out the credit crunch.

Rents also continued to rise this year, but still remain cheaper than buying, with the typical mortgage rate sitting at 6.25 per cent and the typical rental yield at 4.5 per cent.

As a result of rising yields, increasing numbers of landlords are opting to stay in the market, with just 2.1 per cent selling their properties when rental agreements ended, the lowest level since records began in 2003.

RICS Spokesperson James Scott-Lee said, "The lettings market is booming with many vendors opting to rent their property."

"Becoming a landlord was now an increasingly profitable option with rising rents and yields offering good returns," added Mr Scott-Lee.

However, landlords are finding that as the number of rentals available is rising, higher standards of presentation are required in order to let their property. This may mean they are forced to spend money renovating or redecorating in order to rent it for the price they wish to achieve.

This could be another benefit for prospective tenants as they get more style and less shabby chic for their money.