Rental yields up 0.4% in October

Landlord Expert
By Landlord Expert November 16, 2012 10:46

Tenants saw their rents undergo the slowest monthly increase for five months in October, according to the latest buy-to-let index from LSL Property Services.

Average rents rose by 0.4 per cent in October, representing the slowest rate of increase since May. Despite this slowdown, rents are still 3.4 per cent higher than at the same point in 2011 and the average monthly rent in England and Wales now stands at a record high of £774 a month.

Comparatively, rents rose by 0.2 per cent between September and October 2011.

LSL Property Services commercial director David Brown says: “Rents may be rising but the good news for tenants is that the rate of increase is at its lowest in five months. A combination of improved buyer activity and a seasonal slowdown has taken some of the heat out of the rental market as it enters the traditionally quieter final months of the year. However, despite the deceleration, the fact that monthly rents rose by twice the rate seen a year ago points to the underlying strength of tenant demand.”

Rents rose fastest in London and the South East where tenants were paying 0.9 per cent and 0.7 per cent more in October, respectively. On an annual basis, rents rose by 7 per cent in London to reach £1,102. This is the first time average monthly rents in London have passed the £1,100 barrier.

Rents fell in five different regions; Wales, Yorkshire and Humber, the North West, the West Midlands and the East Midlands. The largest monthly decline was in the East Midlands where rents came down by 1.8 per cent.

Although tenants are paying more, the total amount of unpaid or late rent fell to the lowest level since January 2011. Arrears of £265m were recorded in October, down from £297m in September.

The average annual return landlords are collecting on a property stood at £10,819 in October with rental income of £7,926 and a capital gain of £2,892.

Landlord Expert
By Landlord Expert November 16, 2012 10:46

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