Despite a fall in advertised rents in some of the country’s regions such as the North West and Wales, this has been offset by significant increases in the South East and North East with rises of 1.73% and 1.86% respectively.
Overall, the trend seen in the first half of 2013, of advertised rents not fluctuating by any great significance did not change in May.
London rents continued the recovery recorded in April, increasing by 0.83% throughout May, although they remain 9.11% down on the peak experienced in May 2012, before the London Olympics.
Yorkshire and Humber with a rise of 8.39%, the East Midlands with a rise of 6.75% and the South East with a rise 6.44% are showing the largest increases when compared with May 2012.
The annual growth for both Yorkshire and Humber and the North West regions are in contrast to the monthly fall of over 1% witnessed by both in May. The decreases in average advertised rents seen in Wales during April has changed somewhat to a more consistent fall of 0.48%, similar to the pattern experienced during the first half of the year.
‘Overall, average advertised rents in the UK are steady with moderate growth, which has been the trend of late. Whilst rents in London are down 9.11% compared to May 2012, this shouldn’t be read as a negative sign as asking rents were artificially raised by the Olympics,’ said Robin King, Move with Us director.
‘It is however positive news that average advertised rents in the three regions of Yorkshire and Humber, East Midlands and the South East have increased the most when compared with the same time last year. Rising rental prices are often a good indicator for solid buy to let opportunities, providing higher rental yields. Yorkshire and Humber and the North East are the regions to watch,’ he added.
Meanwhile, a separate set of figures show that increased stock levels have sparked renewed competition among landlords in London’s prime rental market. The supply of rental properties in prime central London has increased 12% since this time last year and landlords are becoming more flexible with their rents in order to secure tenants, according to the report from Chesterton Humberts.
It says that the increased levels of stock has been largely fuelled by the growing buy to let market, reduced corporation relocation packages, redundancies especially in the financial services sector and the greater availability of cheap mortgages which is encouraging those in rental accommodation to buy.
The buy to let market continues to attract investor interest with 13% of all mortgages in the UK now representing buy to let landlords. This strong growth is largely a result of disappointing stock market performance which has driven investors towards the long term growth and low volatility of residential property in London when compared to other asset classes.
This is a trend that Chesterton Humberts expects to continue during 2013. ‘The prime residential lettings market remains active, however with buy to let landlords bringing more stock onto the market, tenants now have a wider choice and consequently greater bargaining power. This is forcing landlords to be more flexible in order to attract and retain tenants, which is often resulting in downwards pressure on rents,’ said Nick Barnes, head of research at Chesterton Humberts.