QUIET optimism over rent levels is beginning to be a feature of the lettings market, according to the most recent quarterly survey of its members by the Association of Residential Lettings Agents (ARLA).

The ARLA survey is conducted through the offices of member letting agents, the frontline of the Private Rented Sector and the latest quarter shows that 58 per cent believe rents have stabilised or even risen.

Nationally, 25 per cent of all agents believe rents rose at the end of February.

While 33.3 per cent believe rents have remained the same and 41.3 per cent believe rents are down.

The rental market in central London is still having a disproportionate effect on the national average figures as only 5.3 per cent of ARLA members in the Capital see signs of rents rising.

However, 71.3 per cent believe rents are down and 23.3 per cent believe they have stayed the same.

In the south east there seems to be more optimism.

A quarter, 24.3 per cent, believe achievable rents are up, 35 per cent think they have stayed the same and 40.8 per cent believe them to be down.

For a different picture, the rest of the UK, 43.5 per cent, believe prospects are bright for rents with achievable rents rising.

While 40.6 per cent believe they have stayed the same and only 16 per cent believe they are down.

This picture is drawn from the biggest quarterly survey of letting agents.

It takes in the Buy-to-Let market, as well as general issues concerning the Private Rented Sector.

It is conducted every three months with a base of more than 500 ARLA member letting agents and it is supported by the ARLA Panel of Buy-to-Let Mortgage lenders.

For Buy-to-Let investors, although central London continues to show lower rent levels, the average value of property acquired for investment purposes has risen by 4.7 per cent over the past three months.

The rest of the south east saw rises of 3.2 per cent and the rest of the UK just 0.8 per cent, the survey revealed.

The average value of Buy-to-Let property has risen over the past year from £156,700 to £167,900.

This rise takes account of the downward blip towards the end of last year caused by the fall in values in central London.

The number of new tenancies arranged over the last quarter was down by 14 per cent.

However, it is noticeable the average void period has remained unchanged.

Therefore, it is likely the number of tenants extending the length of their current agreements has compensated for any apparent decrease in newly arranged tenancies.

The average void period remains unchanged at 28 days, although central London has higher than average voids at 36 days.

The overall balance of supply and demand is believed to be improving.

At the three months to the end of February, a little more than half of the ARLA members (56 per cent) responding to the survey believed there were more properties than tenants.

This is an improvement on November, when 66 per cent believed there was oversupply.

In central London, 78.6 per cent believed there was an oversupply during the three months to the end of February.

This is a drop from 84.5 per cent in November.

In the rest of the south east, 54 per cent believed there was oversupply, against 68.2 per cent in November.

In the rest of the UK, only 37 per cent believed there was oversupply, a drop of nearly 10 per cent, from 46.8 per cent at the end of the last quarter.

The survey shows that ARLA members continue to believe the Buy-to-Let initiative has boosted the whole Private Rented Sector and continues to be a dominating factor in the continual improvement of standards throughout the rental market.

John Crossley, chairman of ARLA, said: "There seems to be an overall return to balanced supply and demand as a result of traditional growth in the rental market that always appears when house price growth slows down.

"The survey also proves, once again, that Buy-to-Let investors are a driving force in the housing market by providing choice in housing."

www.arla.co.uk