Rent takes a dive in the run up to christmas

December 19, 2011

CIA Let Property Blog

For the first time in ten months rental prices have dipped, this is according to the latest buy-to-let index from LSL property services PLC.

The average rent in England and Wales fell by 0.4% to £717 per month in November, that is a drop from £720 per month in October.

There was a decline in the annual rental inflation in October, it dropped from 4.1% to 3.5% but this is the first month that rental prices have fallen since January. In the past year (November 2010-November 2011) rent has risen by £25 per month, despite there being a decline.

Rises and declines over the UK…

  •  East Midlands – Fell 2.2%
  •  South East – Fell 2.1%
  •  Yorkshire & The Humber and Wales – Increased by 1.2%

 Fastest rising rents…

  •  London and the South East – Increased by 4.2%

The North East and South West had the smallest rises.

In November, London had a rent rise of 0.3% compaired to October. It rose to £1,033 per month (£41 more than November 2010).

David Newnes, director of LSL Property Services, owners of Your Move and Reeds Rains, said:

“Following their relentless march upward throughout the year, rent rises have taken a pause for breath. Landlords are
looking to avoid having properties vacant over the Christmas period, and can be less aggressive with pricing as tenant activity slows in the run up to the New Year. But across the country, the limited supply of rental accommodation means there will still be strong upward pressure on rents in the early part of 2012.

“The government missed a golden opportunity in the Autumn Statement to give the private rented sector a fillip, and encourage the investment needed for the long-term supply of rental homes to match demand. Extending the stamp duty holiday to buy-to-let investments would have removed a financial obstacle in the path of new investors, easing the strain on the current limited stock of properties. However, with the failure to even extend the holiday for first-time buyers, despite the new mortgage indemnity scheme, demand for rental accommodation from frustrated buyers will continue to increase as we progress through 2012, and rents resume their upwards trajectory.”*

 

*Quote from Propertytalk Live!

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