Rents rise to record levels as tenants return

Steve Lumley·12 March 2021·4 min read

Rents rise to record levels as tenants return

Outside of London, rents are rocketing to record levels with most regions seeing big increases in rents.

And one survey reveals that tenants are returning to big cities.

News that rents are rising comes from Homelet who say that rents are growing by 6.2% outside of the capital.

In London, however, rents have fallen by -4.7% - the highest rate they have recorded.

The average rent now being paid in the UK has risen by 3% year-on-year to reach £984.

With London's rents excluded, the average rent for the UK is £840.

The rent protection provider says that 10 of the 12 regions they monitor have seen rent rises.

Highest growth in rent

The highest growth in rent was seen by landlords in the East Midlands where they rose by 8.1%.

Homelet's Andy Halstead said: "Landlords are charging more to cover essential costs, including their letting agent's services.

"This pushes increased rents onto tenants."

He highlighted that it is tenants who suffer from higher rents and they are meant to be protected from the Tenant Fees Act - though the government was warned over about 'unintended consequences' of the legislation.

Mr Halstead added: "The Covid situation is making the trend more pronounced and there's high demand in areas where stock levels are flat or have declined because tenants are wanting to rent for longer and there are fewer landlords investing in property."

Landlords face the prospect of increasing rent arrears

He pointed out that landlords also face the prospect of increasing rent arrears, while the length of void periods will also grow.

The managing director of Accommodation for Students, Simon Thompson, said: "The private rented sector is crucial to housing supply in the UK and tenants should have quality properties with reasonable rents.

"The government should be listening to what landlords and letting agents are saying about the need for a fair and balanced system for everyone's rights, including tenants."

It has also been revealed that London's landlords have been boosted by the return of tenants to the capital.

According to Rightmove, the number of tenant enquiries for Zones 1 and 2 have risen significantly in recent months.

Popular areas for tenant enquiries

They say the most popular areas for tenant enquiries are Battersea, where enquiries have risen by 111% over the past year, and Nine Elms, when tenant enquiries have risen by 126%.

This follows news that after the pandemic lockdown was introduced, lots of tenants left cities, including London, for larger properties in rural areas.

The director of property data at Rightmove, Tim Bannister, said: "With the prospect of some kind of normality returning on the horizon, it appears that the capital's renters are looking to return to London and take advantage of lower rents."