Rents soar as first-timers struggle to buy
Rents soared to a record high during September as demand continued to be boosted by frustrated home-buyers, research indicated today.
Landlords hiked their rents for the eighth consecutive month during September to leave them at an average of £689 a month, according to LSL Property Services.
The cost of renting a home is now 3.1% higher than it was last year and above the previous all-time high reached in August 2008.
The steep rise in rents is being driven by soaring demand as first-time buyers either delay decisions to get on to the property ladder in the face of housing market and economic uncertainty, or cannot do so because of the problems in the mortgage market.
But the supply of rental homes is not increasing at a fast enough rate to meet the new levels of demand, as landlords too face difficulties getting a mortgage.
David Newnes, estate agency managing director of LSL Property Services, said: "Landlords have seen tenant demand continue to hit new heights. The mortgage market remains tight and many buyers simply cannot get the finance to get a foot on the property ladder.
"And with potential spending cuts on the horizon, and uncertainty over the direction of the economy, many buyers are choosing to remain in rented accommodation for longer.
"As a result, demand for rental accommodation is increasing, and supply is not rising fast enough to match it."
He said the situation had turned the buy-to-let sector into a landlord's market.
The imbalance between supply and demand is particularly acute in London, where rents soared by 2% during September to average £972 a month - 6.8% more than at the beginning of the month.
Rents in the East of England and West Midlands also rose by 1%, while in the South East they were 0.9% higher.
But at the other end of the scale, landlords in the South West and North West actually reduced the amount of rent they charged during the month.
Across the whole of the country, the rise in rents means an investor buying a buy-to-let property could expect to make a total return of 9.2% or an average of £15,592, once both rental income and house price growth is factored in.
But many tenants are still struggling to keep up to date with their rent. Although arrears levels fell slightly during the month, around 10% of rent remained unpaid.
Independent Partners; request a free guide on NISAs from Hargreaves Lansdown
- 1 Rihanna 'nude photos' claims emerge on 4Chan as hacking scandal continues
- 2 Frank Lampard equalises for Manchester City against Chelsea: how Twitter reacted
- 3 Stamford Hill council removes 'unacceptable' posters telling women which side of the road to walk down
- 4 Kim Kardashian 'nude photos' leaked on 4chan weeks after Jennifer Lawrence scandal
- 5 Hitler’s former food taster reveals the horrors of the Wolf’s Lair
Scottish independence referendum: A nation divided against itself
Scottish referendum results: Cross-party consensus collapses amid Tory-Labour spat on the 'English question'
Scottish independence: David Cameron is becoming the 'George Bush of Britain'
Hilary Mantel 'should be investigated by police' over Margaret Thatcher assassination story, says Lord Bell
Plebgate MP Andrew Mitchell called officer a 'little s**t', claim court documents 'exposing ex-Chief Whip's 'record of abusing police'
Archbishop of Canterbury admits doubts about existence of God
iJobs Money & Business
£80 - 100k + Bonus: Guru Careers: A COO / Chief Operating Officer is needed to...
£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...
Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...
£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...
Day In a Page
A three-bedroom, 15th-century cottage with original features in the picturesque village of Sissinghurst
A six-bedroom terraced house with large south-facing roof terrace, cinema room and wine cellar
A new seven-bedroom home built in Queen Anne-style with swimming pool and parkland views in Mortimer
A listed, four-bedroom farmhouse in the rural hamlet of Rushall with detached barn, four acres of gardens and paddocks
A first-floor flat with two bedrooms, a spacious reception room and communal grounds in a leafy part of London
A three-bedroom flat with a spacious rootop terrace and balcony, accessed from a private gated courtyard
A Grade II-listed pile with six bedrooms, stables and 39 acres of grounds in Standlake
A two-bedroom flat with boutique hotel-style interiors, close to the foodie haunt of West End Lane
A two-bedroom flat in a beautiful old vicarage, with many original features, close to the city centre
A three-bedroom 16th-century home with an aga kitchen, private gardens and heated outdoor pool, in Hadleigh
A three-bedrom home in sought-after Queen's Gate Mews, with Italian marble-finished bathrooms
Surrounded by glorious countryside in the village of Udimore, sits this impressive four-kiln oast and barn conversion
A five-bedroom house in the picturesque village of Kettlewell, north Yorkshire
An 18th-century former coaching inn with original staircase, open fireplaces and beams throughout
A Grade II-listed Georgian town house with three bedrooms and a south-facing courtyard, near Arundel Castle
Feel on top of the world at this über chic penthouse on the 37th floor of one of Europe’s tallest blocks.
A Grade II-listed Victorian villa with six bedrooms and two further cottages, all with spectacular sea views
A grade II-listed, Georgian cottage with mature 50ft garden, perfect for summer entertaining
A magnificent Georgian pile with turrets, seven bedrooms, a heated pool and four acres of gardens
Fairoak Farm has five bedroom suites, gym, outdoor swimming pool and golf course
Chic two-bedroom river-fronted flat with a private lift that delivers you directly to your home
A spectacular seven-bedroom Tudor pile, once owned by Henry VIII, with 18 acres of land
A seven-bedroom Georgian property previously used as a picturesque wedding venue
A split-level flat in a church conversion with two en suite bedrooms and 1,200sq ft of living space
A three-bedroom bungalow situated behind an impressive stone wall, £645,000
Windsor Castle overlooks this three-bedroom Victorian cottage located on one of Windsor's smartest roads
Chapel House is a former vicarage with nine bedrooms in the beautiful Upper Wye Valley
A five-bedroom B&B and separate owner's accomodation with potential for conversion
Enjoy summer by the Thames in this two double-bedroom converted warehouse in Rotherhithe village
A one-bedroom, luxury apartment with private gym and concierge service in Moorgate
A four-bedroom house in Hermitage Gardens with three reception rooms and landscaped gardens
A seven-bedroom Grade II-listed property with a separate self-contained apartment
A five-bedroom Victorian house with three reception rooms and galleried landing, £695,000
A six-bedroom farmhouse with five acres of land in a former cloth-making village
A secluded seven-bedroom detached house with large private garden, £490,000
A three-bedroom cottage overlooking Sarratt village green with open fires and solid oak floors
A three-bedroom maisonette flat in a Grade I-listed, Georgian townhouse in a sought-after location
A one-bedroom apartment located within a private gated development, north of Turnham Green
Look forward to a brighter future at two-bedroom Sunny Cottages, ideal for Londoners looking to downsize