Average rents ‘surprisingly resilient'
Rental yields have been consistent
Average UK rents have experienced a very modest fall of 0.3% during the last 12 months, despite the bleak economic backdrop...
Flat and house-share website Spareroom.co.uk claims that the "lodger effect" and a reduction in the number of accidental landlords, have bolstered the rental sector, although its research also reveals large regional variations in the level of average rents and the degree to which they have moved up or down over the year.
Spareroom.co.uk compiled a list of the top 10 postcodes that recorded the highest average monthly room rent rises since November 2008. The suburbs of Sheffield came top of the list with average rents rising by 19.2% during the past year. Market Deeping in Lincolnshire and High Wycombe in Buckinghamshire came next with rises of 19.0% and 18.6% respectively over the same period.
The figures also recealed that city centres have enjoyed some of the biggest increases in average room rents, with Wolverhampton, Liverpool and Oxford city centres all in the top ten with increases of 17.7%, 16.7% and 16.3% respectively since November 2008.
Some areas have not done so well. Bolton and Plymouth saw average room rents fall by 28.7% and 24.4% respectively in the past year.
Matt Hutchinson, director of Spareroom.co.uk said:
"The last three months have since a noticeable recovery in the rental market. This can be put down to a number of factors. Firstly, we are seeing far fewer accidental landlords coming onto the market and many homeowners who became reluctant landlords are now looking to sell rather than continue to rent, as the property market shows signs of picking up.
"The "lodger effect" which has swept the country, is also playing a significant part in average rent rises, with both people looking for lodgers and lodgers looking for rooms at record levels. This level of interest is unlikely to be sustainable in the long term, but it is certainly helping to give the rental market a healthy pre-Christmas boost."
Meanwhile tenant eviction service Landlord Assist warns that those landlords renting out more expensive properties to tenants with higher incomes are more at risk of payment arrears than those lower down the scale.
Contrary to popular belief it claims that it is the higher earners who suffering the most as a result of this recession.
Graham Kinnear, managing director of Landlord Assist said:
"Many landlords take the view that one property at £1,000 per month requires less management and repair than two at £550 per month. However this is not necessarily the case and the situation appears to be changing as higher earning tenants are bearing the brunt of the economic slowdown."
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