According to the latest Goodlord Rental Index, rents reached an eight-month high in May. *
Prices have steadily risen in recent months, and they are now approaching the all-time high record set in 2021. Meanwhile, void periods have remained stable month over month, despite regional data showing a more varied picture on the ground, while tenant salaries have decreased. *
In May, the average cost of rent in England was £1,020 per calendar month, which was up 0.83% from April. *
This is higher than the averages recorded for the past eight months. The last time rent prices exceeded £1,020, was in September 2021, during the market’s peak season, when rents averaged £1,104. Overall, the cost of rent has increased by 11% in the last year.
The East Midlands saw the largest increase in rent costs, with prices rising by 2% per property, bringing the average price up to £857 per month. Rental values in Greater London remain the most costly, averaging £1,723 in May and 13% in the last 12 months.
Average Void Periods Low
Between April and May, the average void period remained stable with an average of 19 days. However, the picture was a little more mixed on a regional basis. The East Midlands, Northeast, and West Midlands all saw a 9-10% decrease in void periods.
After five months of steadily rising average tenant salaries, average earnings fell slightly in May. They fell by 2.7%, from £30,044 in April to £29,247 in May.
Tenants in London, the most expensive city to rent in, earn the most, on average, at £42,955 a year. And, at an average of £24,350 per year, they are the lowest for tenants in the Northeast, the cheapest location to rent.
Tom Mundy, COO at Goodlord, said: “With the squeeze on available stock, we’re not surprised to see rents continuing to climb as we head into summer. Void periods have started to fluctuate that bit more, which offers an early indication that the market is beginning to settle down following a long run of consistently high demand. The message to agents and landlords, however, remains very much the same; there is a huge consumer appetite for good quality rental homes, and this shows no sign of abating.” *
Rental Market Growth Predicted to Continue
According to recent statistics from Statistica.com, there are two and a half times more households renting private accommodation in England than there were 20 years ago, with two million households in private leased accommodation in the year 2000, which rose to 4.43 million last year.
According to specialists at LOVESPACE, this trend will only continue to grow in the face of the UK’s cost of living problem.
Along with the expanding population, marriage and relationship breakdowns, the appeal of maintenance-free rental contracts, and the necessity for flexible housing continue to fuel demand for private rental properties. Plus, the cost of stamp duty and raising money for a deposit is preventing people from being able to afford a home, and increasing house prices make it more difficult for people to step onto the property ladder.
On the other hand, many people prefer the flexibility of renting from a landlord, such as the ability to move between or across cities and towns without being tied to a certain postcode and not having to pay if the boiler breaks unexpectedly.
If you’re looking to expand your lettings portfolio this year, contact our expert local agents.
*According to the latest Goodlord Rental Index