View more on these topics

Rent arrears dive as year-on-year B2L returns jump

Rent arrears hit a two-year low of £213m in July despite landlords raising rents for the sixth month in a row.

The latest buy-to-let index from LSL Property Services shows the average rent now stands at £676 – 2.3% higher than July last year. The average rent grew 1.4% between May and June this year and 0.5% between June and July.

Arrears have dropped to 9.2% of all rents – down from 11.2% at the start of the year.

Total returns on buy-to-let dropped slightly to 10.1% in July from 12.3% in June with the average landlord making a return of £15,961. But year-on-year total returns were up from -6% in July 2009.

An investor buying property now could expect a total annual return of 3.5%, the equivalent of £5,838.

David Brown, commercial director at LSL Property Services, says: “We don’t expect rents to fall. With inflation well above target, interest rates can only go one way – north.

“When they rise, landlords will face increased monthly mortgage repayments and many will try to raise rents to cover the difference.”

Recommended

If minor fraudsters were prosecuted it would deter others

Rooting out fraudulent documents is made harder when so many customers only provide internet bank statements. Unfortunately, it seems the provision of such documents is not illegal although why someone would want a novelty P60 or payslip other than for fraudulent purposes is beyond me. As an underwriter I am reliant on the mistakes made […]

Tackling the housing crisis will take more than money

The latest housebuilding figures from the Department for Communities & Local Government confirm the worst fears of many within the property industry. We are failing to address the housing shortage in any meaningful way. Let’s look at the number of housing ‘starts’, new housing projects where work has begun. In England, work has been started […]

Newsletter

News and expert analysis straight to your inbox

Sign up