20 Oct

Rents reach record high

Rents reach record high

Rents across England and Wales have reached a record high of £768 per month, even though there have been suggestions the market is slowing down.

In the year to September, rent prices rose by 1.5 per cent - down from 2.4 per cent in the year to August.

The buy to let index from lettings agents Your Move and Reeds Rains, shows that on a month-to-month basis, average rents rose by 0.8 per cent - equal to £7.

David Newnes, director of estate agents Reeds Rains and Your Move, explained that rent rises have always traditionally tracked inflation and with the cost of living increasing, there has been an increase of the prices charged by landlords.

However, he also predicts that the market may start to cool as the end of the year approaches.

"Autumn is always a busy period for the lettings industry, and this has been no exception. Looking ahead, it is likely that rents in most parts of the UK will have now reached their seasonal peak so as the market cools along with the autumn weather there may be opportunities for some tenants to pick up a favourable deal," he explained.

He added that the latest LSL Landlord Survey is predicting rent rises of just 1.8 per cent over the next 12 months - which is below the target of rate of inflation.

Mr Newnes also stressed that there has been a strong rise in interest for properties outside of London and the South East as they benefit from an improving economy.

"Regions with a new charge of economic growth, like the North West or East of England, have now led annual rental growth on an equal basis with the capital for most of this year. London's rents were rising by eight per cent at the start of 2013 but are now climbing at around a quarter of that pace," he said.

The data shows that in five out of ten regions now have rents higher than 12 months ago, with the East of England reporting an annual increase of 3.1 per cent, followed by 2.3 per cent in the South West and 2.2 per cent in London.

But there has been a fall in rents in some of the UK as demand has not kept up with the rest of the country.

In the West Midlands rent costs are 2.4 per cent below last year's levels, while both the North East and Wales have also seen drops.
The index is also predicting that if rental prices continue to increase at the same rate over the coming quarter, then the average buy to let investor in England and Wales could see a total annual return of 22.1 per cent over the next 12 months.ADNFCR-1222-ID-801755255-ADNFCR

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