LONDON’S rents hit a new record high in May, according to industry data published today, while prices in the south east also recorded rapid growth.
The average renting Londoner now pays £1,038 per month, up 0.6 per cent on the month to May and 4.2 per cent on the year, LSL Property Services’ buy to let index shows.
The previous record high came in November 2011 when rents stood at an average of £1,033.
That compares with an average rent of £712 per month across England and Wales as a whole – a rise of 0.4 per cent on the month and 2.3 per cent on the year.
The south east saw the next fastest increase, with rents rising 0.5 per cent on the month and 3.1 per cent on the year to an average of £729, while the second most expensive area is the east of England, where average rents are £733 per month.
LSL’s director David Newnes warned that high rental demand was unlikely to disappear any time soon – in part because high prices are stopping savers building up deposits to buy a house.
“The reality is that thousands of frustrated buyers are still financially trapped between a rock and a hard place,” he said.
“Historically high rents and rock-bottom savings rates are hampering attempts to save for the larger deposits banks now require – not to mention meeting the cost of the reinstated stamp duty tax.”
On top of that, Newnes believes the flexibility of renting appeals to more families in tough economic times, adding further to demand and keeping price pressures high.