Third successive monthly rise in rents
On a monthly basis, rents rose in all regions of England and Wales but one, according to the latest figures from LSL Property Services which owns Your Move and Reeds Rains. Wales experienced the largest rise, with rents increasing by 2%, followed by the North West and West Midlands where rents rose by 1.7%. Following a rise of 0.9% to £1,047, London’s rents hit a new high for the second month in succession.
Indeed, London is still the region with the fastest annual rental growth. Rents jumped 4% so tenants are now paying an average of £41 extra per month compared to June 2011. The South East had the second highest rental inflation, with rents climbing 3.6% compared to 12 monts ago.
“The sheer weight of tenant demand continues to push up rents across the country,” said David Newnes, director of LSL Property Services. “Lending criteria remains tight and the number of mortgages given to first-time buyers, especially those without substantial deposits, is still a long way from the level seen before the credit crunch. But shorter-term factors were also at play in June. The rental market tends to see a flurry of activity at this time of year as tenants look to move before the onset of summer holidays, but this trend has been exacerbated, especially in London, by tenants moving with urgency to secure properties ahead of the disruption of the Olympics.”
Overall rental arrears worsened in June, with 9.2% of all rent late or unpaid at the end of the month, an increase from 8.9% in May. Unpaid rent in June came to £289m, an increase of 5% from May.
Jonathan Moore, director of easyroommate.co.uk said: “As if it couldn’t get any more difficult for first time buyers, rents are still rising, undermining how much they can put aside each month to meet the steep deposits lenders require. With saving rates low and inflation outstripping wage growth, the thousands of would-be buyers trying to save enough cash to make their first purchase face a herculean task. Given the level of demand from frustrated buyers, the private sector is creaking under the strain, and the competition for limited accommodation is pushing up rents.”rent
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