Rents across the UK increased by 0.7% month on month up to October, and are showing no signs of the slowdown that normally hits at this time of year. According to the latest Landbay Rental Index rental amounts rose around the UK with only Scotland seeing a marginal monthly fall of 0.1%.
The report suggests the latest rises indicate that consumer demand, growing salaries and unemployment levels hitting their lowest level since 2008 have put an end to the usual falls in rent that begin as the year approaches its end.
The last time the UK saw a sustained period of falling rents was during the winter of 2012 and 2013 in which rents dropped on a monthly basis from August through to April. Every month of 2014 saw rents increase and they have remained strong throughout the majority of 2015. They experienced slight decreases between June and August but rose again in September and October.
Seasonal rent falls are typically due to a decrease in demand following elevated demand in the summer from students, young people beginning their careers in new locations and the termination of 12 month tenancies. As this has not been the case this year it is testament to the fact that the rental market is still experiencing record levels of demand.
The fastest rent increases in October were for three-bedroomed properties and one-bedroomed apartments which are highly popular with small to medium sized families and young professionals starting their first full-time job.
The UK increases are being driven by London and the south east with rents in the capital increasing by 4.1% in October. London is impacting the national private rental sector as we continue to see a surge in rents in commuter hotspots. Many towns and boroughs located within one hour of the city are experiencing an influx of renters and consistently faster rental growth than the national average.
The almost interrupted increase of monthly rents since the spring of 2013 shows that residential investment property is a resilient asset class that has been able to maintain excellent performance throughout a period of uncertainty and particularly low inflation.
We offer a selection of services to investors and landlords, and can help you to deal with all changes taking place in the property market. From comprehensive guaranteed rent schemes to block management in the City of Westminster and the rest of the city, your properties and tenants will be well taken care of when you are working with our team.