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Rents across England and Wales increased by 1.6% in the 12 months to February, the first month on month rise since October 2013, taking the average rent to £743 a month. Overall seven in 10 regions saw higher rents in February than January when the rate of increase was 1.4%, according to the latest Buy to Let Index from LSL Property Services. The firm, which owns the UK’s largest lettings agents network including Your Move and Reed Rains, also pointed out that February was the second best month on record for tenant finances as proportion of late rent falls to 6.9%. Landlords have earned an average annual return of 9.7%, or over £16,000, over the last 12 months. ‘Property to rent remains in high demand. Despite great improvements in the prospects of many first time buyers, there are still millions of households who rely on a healthy private rented sector for their homes,’ said David Newnes, director of LSL Property Services. ‘February’s annual increase remains below the rate of wider inflation. However, this latest uptick and the high level of demand in the lettings market emphasise the importance of ongoing investment. Landlords have invested heavily in expanding their portfolios and need to continue to do so to keep pace with demand from tenants,’ he added. The sharpest monthly rises were seen in Yorkshire and the Humber and the West Midlands, where in both regions rents rose by 1.2% on a monthly basis. The next fastest monthly rise was in Wales with a 1% increase, while the East Midlands saw rents rise 0.6% between January and February. Of the three regions to see a monthly fall in rents, the fastest drop was in the South East, down by 1.5% since January. Meanwhile rents fell by 0.6% on a monthly basis in the East of England, and by 0.1% in the North West. A majority of regions also saw higher rents on an annual basis. The South West saw the quickest rise, up 4.7% from February 2013. This was followed by 3.3% in London and annual rent increase of 2.2% in the North West. By contrast, rents in the East of England now average 3.1% less than a year ago, followed by a 2.3% annual drop for Wales and a 1.9% annual fall in the West Midlands. ‘Across the UK there has always been a huge level of variation between different local markets. But in the last year some of these differences have become more apparent as the property market has witnessed such a rapid shake up and improvement,’ explained Newnes. ‘Those looking to rent, or to let a property should look into the intricacies of their local market, which can have at least as much bearing on the level of rent as the property itself,’ he pointed out. The index also shows that gross yields on a typical rental property remained steady on a monthly basis, standing at 5.2% in February, the same as in January 2014. However, yields have fallen… Continue reading →
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