Letting agency group LSL Property Services says that private rents rose by 0.5% on a monthly basis in April, meaning that the average rent is now £709 per month.
LSL publish a monthly Buy to Let Index and for April it shows rents rising for the first time in three months. However, despite this rise the annual rate of increase steadied with rents 2.4% higher than a year ago, compared to 2.7% in March. Our cheap landlord insurance clients who work hard to maximize their returns will no doubt take some comfort from these figures. Given the state of the economy and worries about the Eurozone things could be a great deal worse.
Rents rose in seven regions of England and Wales on a monthly basis. The largest rises were in the North West and East of England. In London the rise was 0.7%, which now means that the average rent in the capital is £1,032 per month.
Worse news for our buy to let property insurance clients was that rent arrears rose in April, with 9.9% of all rent being late or unpaid at the month end. A total of £306m was unpaid in the month. If the economy continues to struggle this figure could well increase. It remains to be seen whether rent guarantee premiums will rise.
LSL Property Services plc owns the UK’s largest lettings agent network, including Your Move and Reeds Rains. They have calculated that the total annual return on a rental property is now 3.4%. This takes account of annual rented property price inflation and void adjusted yield at the point of purchase.