The latest buy-to-let index from LSL Property Services shows the average national rent now stands at £725 per month. This figure is up slightly (1%) on June and has now surpassed the previous record high of £721 per month that was set in October 2011.
The index also shows that rents rose in eight out of ten regions in England and Wales with rents in the South-East climbing the most at 2.2%. The West Midlands saw the next largest increase, rising by 1.8% with several regions showing similar increases. Some private landlords have even helped out tenants by dropping the rents by around half a per cent in both the South-West and the East of England. Rents in the capital have as expected hit a new high for the third consecutive month and now stand at a huge £1,057 per month. The report also pointed out that tenant finance deteriorated again last month, with total unpaid rent amounting to £295m, up from £289m in the previous month. With the economy still in recession, and rents climbing, the number of tenants experiencing difficulty is also steadily climbing. Landlords are still concerned that tenants will be leaving their properties that they protect by taking out buy to let insurance.
David Brown, commercial director of LSL Property Services, said “The backlog of frustrated first-time buyers in the private rented sector showed no sign of clearing in July – in fact, it is still growing. As lending to those without substantial deposits remains depressed, demand for rented accommodation can only go one way in the long-term – providing further upwards momentum for rents. The rental market is also entering its summer peak, as recent graduates and those with new jobs begin to look for new accommodation. With more tenants on the move, alongside long-term underlying demand, fierce competition for properties is enabling landlords to increase rental prices to new highs.”