Rents rise 4% over 2011

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by Gill Montia

Monthly rents across England and Wales fell for the second consecutive month in December, showing a seasonal dip of 0.8% to an average £711, according to the latest Buy-to-Let Index from LSL Property Services.

Seven out of nine regions saw falls, with the biggest declines in the South East and North East (-1.9% and -1.4% respectively).

In London, rents declined for the first time since December 2010, falling by 0.9%, but compared with a much bigger drop of 2.3% a year earlier.

For the typical tenant, the annual rise in rent stood at 4%, up from 3.5% in November, and total annual returns for landlords increased to 3.7% (November 2.7%) although average yield dipped slightly, to 5.2%.

In the last 12 months the fastest rising rents on an annual basis were in London +5.6%, and the East and South East of England, with rents rising 5% in both regions.

Turning to arrears, Christmas spending resulted in a rise to 10.7% of all rent late or unpaid (November 9.3%).

Commenting on the figures, LSL Property Services director, David Newnes, says: “The rental market was sheltered from the full impact of the seasonal lull by the strength of underlying tenant demand.”

He adds: “It won’t be long before rents will resume their upward march.”

LSL’s buy-to-let index is based on analysis of over 18,000 properties across England and Wales each month.