Rising rents rocket back to record high

Rents have recovered to match their record high as the lack of mortgages pushes would-be homebuyers to rent property.

With average rents hitting £692 per month in England and Wales, landlords are expecting income to rise to new peaks for the rest of the year.

The Council of Mortgage Lenders, speaking for all the UK’s major banks and building societies, has already stated lending is likely to remain restricted for several months.

Year-on-year, rents are up 4.4% and yields are increasing as well – up to 5.1% as rents outperform house prices.

David Brown, commercial director of LSL Property Services, said: “The rental market is heating up as thousands of would-be tenants have taken advantage of the weather and long weekends to hunt for new rental homes.

“Even a slightly stronger supply of property has failed to cool rental inflation as landlords take advantage of the growing number of mortgage products available. Competition is fierce and tenants are paying a premium to secure properties. The average landlord is charging nearly £30 more a month than a year ago, and the rate of increase is unlikely to tail off as lending to first-time buyers remains subdued and demand for rental homes is stronger than ever.”

LSL Property Services runs rental brands Your Move and Reeds Rains.

Landlords in London and the south east were the biggest winners from improved rental income.

Those in London enjoyed a 7.9% boost to an average £911 per month, while the south east surged 5.7% to £705 a month. The east of england was the only region to e=record a fall – down 0.8% to an average £705 per month.

April rent arrears increased to 11.8% of all rent unpaid or late by the end of the month, up 2.4% from March. Landlords were owed £284 million, an increase of nearly 27% from the £224 million unpaid in March.