Local demand is driving the residential rental market. There is a slow increase in rental prices.We have experienced a slight increase in demand for rental properties compared to the same quarter of the preceding year (Q4, 2012). This had a positive effect on the number of new rental contracts and resulted in shorter turn-around/vacancy periods for average rental properties. In some cases, this has also allowed for minor rent increases for landlords with long term tenants in place.
The driving force behind this market trend is primarily a change of consumer behavior. More and more people consider renting as a long term solution for their housing needs. Tight lending conditions is also a significant factor why consumer rent rather than buy. An increasing interest for renting is apparent in all tenant groups, especially young couples who are delaying the purchasing of their first home and continue to rent.
But the shortfall in supply for suitable housing will not drive the prices significantly higher. Despite the imbalance between demand and supply, stagnating earnings will also curb any significant increase in rental prices.
There is steady increase of rental fees in district 8 which is the obvious effect of the recent developments at the Corvin Promenade project. With the upcoming handover of the metro line 4 tenants are willing to sign long term rental contracts for definite periods again.
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