Rents rise in all regions for first time
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Rents increased in all regions of England and Wales for the first time on record in September, the latest buy-to-let index from LSL Property Services reveals.
In September, the average rent rose by 0.7% to reach £718 in September, surpassing the previous record high of £713 in August.
This represents a 4.3% increase on September 2010’s average of £689.
The research also shows the average yield rose from 5.2% in August to 5.3% in September.
Rents hit record highs in six regions: London, the South-East, Yorkshire and Humber, the East of England, Wales and the East Midlands.
Rents increased the fastest in the South-East and the East Midlands, where they rose by 1.8% and 1.1% respectively compared to August, while the smallest increases were in the West Midlands and the North East, where rents rose by 0.2% and 0.3%.
Over the past year, London’s rents have risen at a faster rate than any other region, increasing by 5.8%.
David Brown, commercial director at LSL Property Services says the index shows that rising rents is not just a regional phenomenon in London and the South-East.
He says: “In areas of the highest demand, such as the capital, competition is driving up rents at a faster rate than elsewhere, but no region has been immune to the growing demand for rental homes from frustrated buyers.
“In many cases, buying a home is now cheaper on a monthly basis – provided renters can get past the stumbling block of the substantial deposit requirements.”
Tenant arrears improved in September following August’s seasonal increase, dropping to their lowest level since April 2010.
8.6% of all UK rent was unpaid or late by the end of September – down from 10.7% in August. Unpaid rent totalled £243m in September, down from £300m the previous month.
Brown adds: “Shelter’s recent research shows rising rents are placing renting households under mounting financial pressure. But this has yet to manifest itself in rising tenant arrears, which have remained markedly low in 2011 – and even dropped last month as summer holidaymakers got their finances back in order following vacations.
“But over the longer term, landlords have become less forbearing, looking to replace tenants with payment issues quickly in the hope of higher rental income.”
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