The majority of tenants expect rents to rise over the coming year, according to Chestertons, in a survey that comes amid the cost of living crisis.

Around 60% of tenants believe that rents will increase over the next 12 months, says the estate agent’s latest quarterly tenant survey. This compares with 23% of tenants who said rents would rise over the year ahead when the study was first conducted in April 2019. 

The report comes after the Bank of England has raised interest rates five times in the row since December to 1.25%, which has raised mortgage and remortgage costs for landlords and homeowners.

The study says that “despite the challenging economic climate” the proportion of tenants who intend to buy a property has risen since April 2019, to 83% from 74%, although only 14% plan to buy within a year and only a further 17% within one to two years.

Work relocation has become the most important reason for renting, at 33% from 20% (in January 2021, when this question first appeared on the survey). The report says this shift, “may reflect the increase in the return to office working with many people having moved out of London or back to the parental home during the periods of lockdown”.

“The percentage of respondents saving for a house deposit has more than doubled – from 7% to 15% – and the proportion of respondents who are renting because they can’t afford to buy has also risen, from 17% to 26%.”

The two main considerations for tenants when looking for a property haven’t changed since the firm’s first survey in April 2019. Location remains the most important criterion for 45% of renters, although this is down from 58% three years ago. Price is still the second most important factor but has increased its score to 34% from 26% in the period.

 The two top reasons for selecting a location also remain the same – proximity to public transport, which dropped to 88% from 94% in the three-year period and proximity to shops, which was unchanged at 59%.

The inclusion of utility bills in the rent has become the most important feature for tenants, which rises to 77% from 48% three years ago. Second, comes a fast, reliable internet connection, which the report says is “likely further evidence of the growth in homeworking”. This feature lifted to 60% from 45% in 2019.

The most popular rental contract length remains one to two years among 46% of renters. However, shorter contracts, between six to 12 months, are now much more popular than three years, 31% are in favour of them now, compared to 18% in 2019. 

The survey says: “The proportion of respondents preferring longer contracts has dropped by more than half, which is likely to reflect tenants not wanting to commit to longer agreements while rents are so high.”

Chestertons says its survey was completed by 212 tenants. It adds the majority of respondents are still couples, although the percentage has dropped from 58% to 42%.

The number of flatsharers included in the study has increased from 16% to 23%, which may reflect how rents have become much more expensive. The number of singletons has fallen, from 37% to 29%, which may reflect affordability issues for people having to foot the rent bill on their own.