LONDON rent rises are outstripping those in the regions as frustrated would-be homebuyers turn to short-term sources of accommodation.
Rents in England and Wales rose for the sixth month in a row in July with the capital seeing the largest gains, according to the Buy-to-Let Index from LSL Property Services, which is published today.
Average prices soared 7.1 per cent to a new high of £1,009 per month. Rents rose 5.5 per cent in the north east and 4.8 per cent in the east and west Midlands.
The average rent in England and Wales rose 0.6 per cent to £705 per month, following to the previous high of £701 in June.
The average rent is now £29 per calendar months higher than in July last year. The average yield reached 5.2 per cent in July, up from 4.8 per cent a year ago.
David Newnes, estate agency managing director of LSL, which owns Your Move and Reeds Rains, said rising rents meant it was becoming harder for first-time buyers to save deposits.
“Rents are on an upward trajectory, and it is unlikely that tenants will gain respite any time soon. Demand from thousands of frustrated buyers each month is underpinning buoyant competition for rental homes, enabling landlords to increase prices.
“This is the peak summer season, with more renters on the move, the market will continue to heat up. Such strong demand and high rental incomes has forced lenders to take notice, and more are returning to the sector.”
Competition in the buy-to-let market means the range of affordable products is expanding, he added.
Rents fell in the West Midlands, Yorkshire and the North West.