Rental yields remain strong
One and two bedroom properties are achieving the best yields at 6.8% and 6.4% respectively and rental accommodation in Scotland is achieving the highest average yield at 6.6%, followed by the Midlands (6.5%) and Wales (6.4%).
All sized properties saw an increase in average rents quarter-on-quarter apart from three-bedroom properties which decreased 0.5%.
Four-plus bedroom homes saw the greatest increase in average rents up 3.6% in Q3 2013 compared to Q2 2013.
Nick Dunning, group commercial director at Countrywide, said: “Rental demand has continued to strengthen with the number of new tenants registering for rental accommodation increasing 25% in Q3 2013 compared to Q3 2012.
“The recent announcement to introduce Help-to-Buy Phase 2 in October 2013 will undoubtedly facilitate a proportion of tenants to make the transition to home ownership.
“This is great news for both first time buyers and tenants frustrated by the lack of available accommodation in the current market.
“A lack of new stock across Greater London has seen tenants sign extended tenancies as they are keen to secure their property for longer.
“The average tenancy length in Greater London has increased 13% year-on-year to 17 months.”
Rents are likely to have been underpinned by an influx of families looking to move home before the new school term began in September and a lack of supply of larger properties on the market.
Overall, average rents across England, Scotland and Wales increased 2.7% quarter-on-quarter.
Wales saw the greatest increase in average rents up 5.6%, followed by the South West up 5.1% and the Midlands up 4.6%. Despite seeing an increase in average rents in Q3 2013, year-on-year Central London and the South East saw a reduction in rents of 3.3% and 1.5% respectively.
Year-on-year rent arrears decreased in all regions apart from Scotland where they increased 4.2%. The greatest fall in rent arrears was in Central London down 2.1%. There was no change in the level of rent arrears in the East of England.