Student lets push rents up to record high
The average monthly rent price has reached a record high after being fuelled by a jump in high-value student lets, an analysis from Goodlord reveals.
The lettings platform says that demand for student lets was higher than average and included student tenants snapping up a variety of high-value homes.
This led to England’s average rent price rising in July by 17.96%. The average rent rose to £1,238, from £1,050.
Goodlord says that is the highest ever increase recorded by their index and every region has seen rents increasing.
Students renting there are behind the surge in rent
Tenants in the North West saw the highest increases, where prices jumped by 44% - and Goodlord says that students renting there are behind the surge in rent.
The average rent for renters in the North West rose to £1,213 in June, from £838.
Goodlord says that the next largest rise was seen for renters in the South West where prices rose by 36% to reach £1,539, from £1,130.
However, tenants in Greater London saw a 3% rise but it is still the dearest place to rent a home in England where renters are paying an average of £1,797 per month.
‘Driven by a surge in high-value student lets’
Tom Mundy, the chief executive at Goodlord, said: “Driven by a surge in high-value student lets, it’s been a staggering month for the market.
“The heatwave failed to cool demand and instead we’ve been seeing record high rents and record low voids.”
He added: “The lettings market is incredibly busy, and demand shows no signs of abating this summer.
“Agents are working hard to ensure good quality homes stay in the rental market and tenant demand is met.”
Lowest ever void rates recorded
Goodlord is also reporting that along with the highest rental rent rises, July has also seen the lowest ever void rates recorded by their index.
In England, the average void period dropped in July by 41% and is now just 10 days on average, down from 17 days previously.
The platform says that every region they monitor has seen a huge reduction in void periods.
Again, they say that the fall in voids is being driven by a demand for student properties with the North West and the South West also recording the largest proportional drop in voids.
Void periods found in England
The lowest void periods found in England are for rental properties in the South West where landlords experience a void period of just five days, on average.
The highest voids are found in the West Midlands at 17 days - but that’s still down from June’s figure of 24 days.
The managing director of Accommodation for Students, Simon Thompson, said: “There’s no doubt that there is strong demand for quality student accommodation in the UK which has been reflected in the rise in rent.
“However, landlords need to be mindful that rising rents could mean that tenants will struggle to pay rent on their home in the months to come which could lead to a serious situation that needs to be dealt with.”
Return of students boost Unite
Meanwhile, student halls provider Unite Group says the return of students means it is hopeful of having full halls in the next academic year.
As a result, they say they can put rents up quicker than expected - though not quickly enough for the company to offset rising debt costs.
Unite runs 172 halls of residence around the country and for September has filled 92% of beds.
That’s more than the firm had predicted, and they say that they will fill 97% of beds next year.
Large growth in student numbers
Unite’s chief executive, Richard Smith, said they have seen a large growth in student numbers from Nigeria, Pakistan and India.
The average rent for rooms outside of London are £150 per week, which includes bills.
And Unite says it should be able to lift rent prices by between 3% and 3.5% next year.
