The latest buy to let index published by LSL Property services yesterday revealed some interesting figures and insight suggesting that rents have hit a new high with a sharp slowdown in annual rent rises. The headline points are as follows.
- The average residential rent across England and Wales has hit a new all-time record high at an average of £768 Per Month.
- Rent rise has slowed dramatically to 1.5% year to date, down from 2.4% in year to August.
- Nationally the number of tenants in rent arrears has also decreased to 7.2%, down from 8.5% last September.
- Increasing house prices now mean that Landlords’ gross returns reach a record 13.4% before mortgage or maintenance costs.
David Newnes, Executive Director of Estate Agency at LSL Property Services comments: “Landlords have many costs to consider, which always makes the reality of profits rather different from gross headline figures. But a record for gross returns is encouraging news for landlords’ finances and the prospects for further investment in new homes to let.
“Favourable conditions for landlords have all come at the same time – low interest rates, steady growth in purchase prices, and a solid underpinning from rental yields. Caution is always a vital consideration as landlords look to let new homes. But now the prospect of interest rate rises could be even further off, landlords will be able to continue growing their portfolios just as easily for some time. That will be good news for tenants too.”
Source: LSL Buy-To-Let Index 17/10/14