Private landlords are benefiting from demand for rental accommodation as first-time buyers switch to the private rented sector after being unable to secure a mortgage.

According to figures from UK letting agent Your Move, rental demand increased 63 per cent in December compared to the same month in 2008.

David Newnes, managing director, said the drop in mortgage lending in 2008 has boosted the lettings market.

Although house prices fell, many would-be buyers were unable to get a mortgage and switched to renting as a short-term solution, he commented.

"In 2008 the lettings market was the only good apple in a bad cart,"Mr Newnes said.

"The silver lining in this mess, is that landlords are seeing demand go through the roof,"he added.

However, some landlords might consider rental guarantee schemes as the threat of redundancies hangs over some tenants in the current financial climate.

According to recent research by online search engine propertyfinder.com, high mortgage rates are being levied at borrowers who cannot afford to fund a deposit of at least 40 per cent on a new home.

This means that renting is a cheaper option for many would-be first-time buyers who are currently priced off the property ladder, it said.ADNFCR-2002-ID-18994140-ADNFCR

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