Rents 'to continue rising in London'

Rent guarantee insurance may be a good idea for landlords operating in London, as it has been suggested tenants could be feeling the squeeze when they try to pay for accommodation.

Liam Bailey, head of residential research at property consultancy Knight Frank, explained the amount occupants are asked for is likely to keep rising despite the fact it is verging on unaffordable at the moment.

"Our forecast for rents is that they will rise probably by about five per cent per year from this point forward, which is slightly ahead of earnings growth but not hugely ahead," he stated.

It may be the case that some occupants struggle to keep up with the increased cost of living in London, with the expert noting the city is already becoming overcrowded because individuals are forced to share real estate in order to pay for it.

Mr Bailey's comments follow a report by FindaProperty.com that showed average asking prices reached as much as £890 per month in 2011 and it is likely they will keep rising in 2012.

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Posted by Royston Hunter