The East leads the charge in regional rental rises
Across the country the average monthly rent in the UK increased 1.4% in July to £866pcm reaching the highest level for more than two years despite rents in Central and Greater London and Scotland falling back.
Nick Dunning, group commercial director at Countrywide, said: “Countrywide’s Monthly Lettings Index reveals that the cost of renting continues to be higher in relation to the cost of monthly mortgage payments with the average monthly rent now £866pcm.
“According to recent data from the Council of Mortgage Lenders lending to buy-to-let landlords is now at its highest level for nearly five years.”
But Dunning said despite more competitive buy-to-let mortgages encouraging investors to expand their lettings portfolios increasing the supply of available properties to rent there are on average four to five tenants for each property Countrywide has on its books.
Wales experienced a 5% increase in rents while the South East followed closely with a 4.3% increase. Central London felt the biggest decline with a 2.8% drop in rents but held the top spot for the highest monthly rent at £2414.
Scotland, meanwhile, had the lowest average monthly rent at £636pcm.
Analysis from the survey showed that yields remained strong in July with the average yield at 6.1%.
Yields remained the same in all regions in July when compared to June with the greatest yields being achieved in Wales at 6.6%, Midlands at 6.5% and North at 6.4%.
Four plus bedroom properties saw the greatest increase in average monthly rents in July with a 3.8% month-on-month increase to £1,471pcm despite falling 5.5% year-on-year.
Two-bedroom properties saw an increase of 1% to £787pcm followed by three-bedroom properties up 0.9% to £898pcm and one-bedroom properties up 0.8% to £689.
All sized properties saw a year-on-year increase in average monthly rents apart from four plus bedroom properties.
Rent arrears fell year-on-year in all regions apart from Scotland and Central London.
Average monthly rents were up 6.2% year-on-year in Scotland but arrears were also up 4.1%. In Central London rent arrears increased 0.2%.
In terms of property sizes the level of rent arrears fell for all sized properties with three and four plus bedroom properties seeing the greatest decreases at 1.2% and 1% respectively.
Dunning said: “Rental values are being underpinned by the increasing number of people living in the private rented sector and rents are likely to continue rising unless supply and demand becomes more aligned.”