Conflicting views on the status of the rental market seem to dominate recent property news headlines. Let’s take a closer look at some of those stories …
Council wants private landlords to let or lease properties
A measure of the shortage of affordable homes to rent in the nation’s capital is illustrated in a recent appeal by the London borough of Greenwich. A story in Landlord Today on the 1st of May reported the council’s plea for private sector landlords to step up and offer their let accommodation in a bid to reduce homelessness in the borough.
In return, the council will provide free support and training to eligible landlords and strive to match people on its housing waiting list to landlords’ available properties.
The scheme aims to reduce the number of tenants in expensive temporary or emergency accommodation. In this way, it looks to achieve a win-win situation for landlords, the council, and, of course, tenants themselves.
The council looks to reduce its expenditure, landlords stand to let otherwise empty properties, and tenants gain a sought-after stable home.
Rents set for summer spike says industry index
Letting Agent Today recently forecast a surge in rent levels this summer – citing market analysis.
Last month, the average rent paid for rented accommodation in England was £1,216 – a level 4.2% higher than last year’s £1,166 in the same month. On a year-by-year basis, the increase represents an increase for tenants of £50 a month or £500 a year. Nevertheless, this 4.2% rise is a shade lower than the increase of 4.6% recorded in March.
As ever, of course, there are regional differences, with the Southeast, West Midlands, and Northwest all recording average rent increases greater than 5%. In the East Midlands, on the other hand, average rents rose by less than 1%.
The rise in average rents in April marked increases for the fourth month in a row.
What’s happening with rents right now?
A somewhat different picture of the rental market is presented in Rightmove’s latest analysis published on the 29th of April.
The online listings website concedes that rent levels are rising – but at a slower rate than in the past few years. In the three months from January to March, rents outside London rose by only 0.6% over the previous quarter to finish the period at an average of £1,349 a month. This is the smallest quarterly increase since the opening quarter of 2020 – an indication of a relatively stable market.
The current stability is helped by an improved level of supply of rented accommodation which is some 18% greater than this time last year.
The demand for such accommodation has also eased a little. While competition is still strong, it is somewhat lower – so that prospective tenants are able to negotiate their tenancy.
Nationwide House Price Index (HPI)
Perhaps mirroring the stability of the rental market, house prices are also relatively stable, according to the Nationwide Building Society’s report for April.
The growth in average house prices fell from 3.9% in March to 3.4% in April – effectively leaving house prices some 0.6% lower on a month-by-month basis (after allowing for seasonal influences).
The lower rate of growth in prices is largely expected by analysts because house buyers had been especially active in March in a bid to beat the Stamp Duty increases which came into effect at the beginning of April.
Despite the uncertainties of the global economy, house buyers can expect reasonably favourable conditions domestically – and this, too, is likely to dampen any significant surge in prices as the summer marches on.
