After several months of stagnation, news from two different sources suggests landlords are once more seeing rents begin to increase.
In what will be greeted as good news by property investors across the UK, a report by leading letting agents and surveyors LSL suggests that rents are once more on the up. They reported an increase in April of half of one per cent, the first national increase for three months. It really was good news for virtually all of the UK with increases reported in 7 regions with only the West Midlands and Wales missing out. Surprisingly the North West and the East of England fared best both showing increases of over 1%. Across the country the average monthly rent now stands at £709.
On the same day as the LSL report was published, well known estate agents Knight Frank revealed that rental achievements in Central London had also gone up in April. It was by just the smallest of margins, 0.1%, but will come as a relief to all property investors with an interest in landlord insurance across the capital, as it was the first monthly increase for six months. Knight Frank reported a big increase in properties put on the market, over 50%, but only a 5% increase in tenants registering an interest in renting a property.
Although both reports predict a small increase of around 1% for 2012, year on year figures still reflect increases of around the 2.5% mark. One big problem on the horizon for many landlords may be the news from LSL that rent arrears are rising sharply. The total amount of unpaid rent in April soared past the £300 barrier, a rise of 14% which prompted LSL Commercial Manager, David Brown, to say “April’s arrears rise should serve as a warning that landlords cannot afford to take their eye off the ball. Despite several month dips this year, rents are still rising at a faster rate than wages. With a faltering economy and further public sector job losses to come, an increasing number of rented households will see their finances stretched.”