Buy to let bows out: Rents edged down in May as a wave of buy to let properties hit the market

 
Helen Cahill
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Rents took a little dip at the beginning of summer (Source: Getty)

Rents took a slight dip in May as property transactions completed before the government's stamp duty hike for second homes came onto the market.

Compared to April, there was a 0.2 per cent drop in rents, according to lettings agents Your Move and Reeds Rains.

Read more: How landlords are softening the blow of buy to let tax changes

In May the average rent for homes in England and Wales came to £792 per month.

Rents in May were up by 1.8 per cent year-on-year, and it is thought this will only be a short-term effect, as commentators have predicted that the buy to let tax changes will eventually lead to an increase in prices for tenants.

Landlords scrambled to snap-up homes in March before the stamp duty changes came into effect at the beginning of April; there was then a steep drop in property transactions.

Adrian Gill, director of lettings agents Your Move and Reeds Rains, said: "This is the equivalent of a flash flood for the rental market.

Read more: Buy to let tax changes: Why a landlord exodus remains unlikely

"Just a month ago rents were heating up and spring was in the air - but this has been put on hold as a tide of new properties to let has disrupted the normal dynamics of supply and demand.

"But all tides go out again - and this is definitely no exception. Overall the tax changes to the buy to let industry will discourage some property investors, and most of the properties that became available to let in May will have been planned purchases brought forward from later in the year.

"The net effect will not be properties to let - quite the opposite."

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