UK Property Rentals Grow Steadily

LSL Property Services, one of the largest UK residential property services companies which owns such letting agencies as Reeds Rains and Your Move, published its Rental Index, which reveals a 1.4% increase in residential property rents seen in August. Rents have already been rising for 3 consecutive months, thus demonstrating the fastest growth since last summer. LSL Property Services’ Rental Index is based on the survey of 18,000 residential property rentals, which aimed to determine the level of rents, voids, and arrears. According to the Rental Index, an annual increase in property rentals amounted to 8.2% with an average UK property being rent out for £661. It also revealed that rents rose in terms of value and number all over the UK with an exception of the East Midlands, the Humber, and Yorkshire. In the opinion of LSL Property Services’ commercial director, Mr. David Brown, such a sharp increase in the number and cost of rents is caused by strong tenant demand coupled with weak supply of rental properties. He added that these improvements signal a recovery of the housing market as a whole. Mr. Brown also links the rise of rent rates to a decreasing number of so-called “accidental landlords”, which in its turn results in much lower cut-price competition for regular landlords. David Brown is strongly determined that increased rent rates supported by increased house prices and lowered mortgage interest rates make a perfect combination for buy to let investors. He, however, marks that the buy to let industry is for experienced landlords only rather than for speculators, who do not have a long-term approach to this business. The bad news concerning the buy to let sector, however, was also reflected in the Rental Index. The number of tenants in arrears rose to 17.4% up from 15.3% in July. Yet, Mr. Brown was not pessimistic about these figures, saying that these numbers were very likely to be caused by the holiday season.