The rental market is booming according to the Royal Institution of Chartered Surveyors’ Lettings Survey, with new instructions to let in the last quarter increasing at the fastest pace in the survey's history.

RICS found 43% more surveyors reported a rise than a fall in landlord instructions compared to 35% in the previous quarter. New instructions to let houses and flats increased at the fastest pace in the survey's history with 47% and 39% more Chartered Surveyors reporting a rise than a fall respectively.

Surveyors reported that frustrated vendors have been placing their property in the market to let as they have been unable to agree sales due to a lack of demand in the housing market.

Rents have continued to rise while house prices fall, driving gross yields upwards, according to RICS, though rental expectations fell slightly with some surveyors expecting over-supply to push rents downwards in the next quarter.

James Scott-Lee, spokesperson for RICS, commented: "The lettings market is booming with many vendors opting to rent their property while sales in the housing market continue to dry up. Many are willing to hold and await the return of capital appreciation. Becoming a landlord is now an increasingly profitable option with rising rents and yields offering good returns.

Self-regulation for lettings, 15 August, 2008

David Salusbury, chairman, of the National Landlords Association, has welcomed the Law Commission report Housing: Encouraging Responsible Letting.

Commenting on it, he said: "The National Landlords Association welcomes many of the staged reforms the Law Commission proposes. In fact, further enhancing good practice to build on voluntary self-regulation can only be a good thing for both landlords and tenants. We are pleased to see the recognition that local authorities have an important role to play in the enforcement of regulation.

"It is critical to assess this report alongside the other reports and consultations to ensure we break this 'piecemeal' approach to the private-rented sector.”

The Law Commission’s report follows wide consultation with both landlords and tenants. It focuses on improving the overall coherence and stability of the current private rental framework in a cost-effective way.

Based on the principles of smart regulation, the Commission recommends a programme of staged reforms designed to promote self-regulation and enhance voluntary initiatives already in place in England and Wales. The proposals include:

- Creating a housing standards monitor (for each of England and Wales) for the private rented sector
- Establishing an associated stakeholder board to which representatives of all sides of the private residential rented property sector are appointed
- Developing a single code of housing management practice for landlords
- Making landlord accreditation schemes available in every local authority area
- Launching a pilot programme for home condition certificates

The Commission proposes that independent evaluation and development of appropriate incentives to make the programme attractive to landlords should supplement these initiatives.