Last year’s rental predictions: Who got it right?

Last year’s rental predictions: Who got it right?
If we’ve learned one lesson from 2016 it’s that predicting anything is asking for trouble

2016 was not a great year for making predictions – but an investigation into the accuracy of some of the forecasts made by property experts this time last year proves that many were pretty much on the money.

Analysis of property market predictions made by North East sales and lettings firm KIS shows that estate agents Knight Frank correctly prophesised UK annual rent growth of 2.3%, with competitors Belvoir and Savills, and the Royal Institute of Chartered Surveyors not far behind.

Major estate agency Hampton’s and highly-respected property commentator Henry Pryor, who predicted rises of 5.5% and 6% respectively, turned out to be furthest away from the final figure.

Data from the Office of National Statistics suggests rents across the UK rose by 2.3% in 2016, with figures from insurer Homelet suggesting a slightly higher rise of 3.1%

KIS’ own analysis of 20 North East areas – compiled as part of its monthly Housing Now report – indicates that rents in the region rose from an average of £554 in December 2015 to £591 last month, a rise of 5.9%.

The following predictions for how much UK rents would grow in 2016 were made this time last year:

•  Knight Frank – 2.3%
•  Belvoir - 3%
•  Savills – 3%
•  Royal Institute of Chartered Surveyors – 3%
•  Countrywide – 3.5%
•  JLL – 4.5%
•  Price Waterhouse Coopers – 5%
•  Hamptons -5.5%
•   Property Commentator Henry Pryor  (interviewed by Zoopla) – 6%


Ajay Jagota, managing director of KIS Group, had this to say: “If we’ve learned one lesson from 2016 it’s that predicting anything is asking for trouble, but if these figures are anything to go by property experts are doing a much better job of foreseeing the future than professional pollsters do at election time.

The average rent rise prediction in the forecasts we’ve revisited was 3.9%, and although we’re the first to admit that that figure isn’t exactly scientific, it does appear that industry consensus at the start of the year was pretty close to the 3.1%  Homelet recorded at the end.

A big thing to take away from these figures too is that although rents are rising, they aren’t rising as quickly as even some of the experts think. As things are, the market is giving a good deal to both tenants and investors and policy makers should be cautious about pursuing any measures which could jeopardise that”.

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Latest Comments

Kelvin Lloyd
Kelvin Lloyd 09 Oct 2017

IT is up, to the Planners. If they will only give permission for bungalows on certain (suitable) sites, they will be built.

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maggie swift
maggie swift 09 Oct 2017

It's just the beginning of the shocking rise.

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maggie swift
maggie swift 09 Oct 2017

I have recently read that the bungalows can provide social housing for elderly residents in London.

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zoe glover
zoe glover 05 Oct 2017

Update! Worst company I have ever dealt with. Undervalued a Cambridge property by over 100k, wont take on any evidence of valuation including a RICS valuation done 3 years ago for the very same value...

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Paul Edwards
Paul Edwards 27 Sep 2017

Its nonsense articles such as this that make it harder to get clients to realise just how difficult the market is out there. When you see Rightmove and there are more 'price reduced' then 'new' most days...

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Tom Allen
Tom Allen 20 Sep 2017

Absolutely agree with you!

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RyanGeo
RyanGeo 18 Sep 2017

A sharp correction would be a less dramatic expression to use. That is already underway in certain sectors in Reading where I practice as Chartered Surveyor

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sean benton
sean benton 01 Sep 2017

Identity theft is a thread for any profession. So,people should stay alarmed. I once take help from a letting agent and came to know that letting agents are taking every precaution to prevent fraudulent...

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Mark N.
Mark N. 30 Aug 2017

We have seen a surge in instructions over August and that should continue into September too.

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Chris
Chris 30 Aug 2017

Unfortunately, all the legislation bears its force on Landlords and ignores, naively, the effect of Rogue Tenants on the ability of landlords to keep houses in repair and offer properties for rent at reasonable...

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Christian Donovan
Christian Donovan 18 Aug 2017

The write-down on house values, combined with the fall in the GBP saddled the fund?s property portfolio with a 1.4% loss in the second quarter. The shocking amount of $240 million.

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Samantha Goodman
Samantha Goodman 11 Aug 2017

Interesting point of view.

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