Average rents in England and Wales fall by 0.2% month on month
Average rents for homes to let across England and Wales fell 0.2% in May month on month and now stand at £792 per month, according to the latest index data.
This compares to a long term average monthly rise of 0.4% over every May since the recession but they are still up 1.8% over the last 12 months, the data from the buy to let index from Your Move and Reeds Rains shows.
However, on an annual basis rents have seen half the annual rate of rental growth seen at the start of 2016, when in January this stood previously at 3.6%.
According to Adrian Gill, director of lettings agents Your Move and Reeds Rains, the number of properties to let coming on the rental market has disrupted the normal dynamics of supply and demand.
‘Landlords escaping a much larger stamp duty bill by completing their purchases before 1st April have now finished their repairs and paperwork, with these homes to let competing for tenants in May and into June. That short term mismatch has made May an exceptional month, with excellent deals available for some prospective tenants,’ he explained.
He believes that overall the tax changes to the buy-to-let industry will discourage some property investors, and most of the properties that became available to let in May will have been planned purchases brought forward from later in the year.
‘The net effect will not be more properties to let, quite the opposite. If new regulations and taxes produce a drought of homes to let, then the overall shortage of housing in the UK will only bite harder for tenants. Meanwhile, this heightened shortage and possibly higher rents as a result could also protect landlords somewhat from the financial effects of more punitive rules and regulations,’ Gill pointed out.
A breakdown of the figures show that rent rises in London have slowed to just 1.0% over the year to May 2016. This compares to a peak seen in September 2015 when rents in London were 11.6% higher than a year before at the time.
By contrast, the East Midlands have witnessed rent rises of 7.3% over the year, followed by the West Midlands with 5.5% annual rent rises and the East of England with 3.6%.
All 10 regions of England and Wales have seen rents in May higher than a year ago. However the joint slowest annual rent rises have been in Wales and the South East, both seeing rents rise just 0.5% over the last 12 months.
London also leads the negative trend on a monthly basis with average rents in the capital falling 0.7% between April and May, a faster drop compared to a more modest drop of 0.2% in the month before. London is followed by the East Midlands where rents are 0.6% lower than a month ago and Yorkshire and the…
Fri, 17 Jun 2016 06:54:59 +0100