Rents in England Wales increased by 0.2% in the 12 months to May 2019 to an average of £863 while two regions recorded a fall, the latest rental tracker report shows.
But in London rents fell by 0.6% although they increased by 0.3% month on month to £1,265 and the capital remains the most expensive place to rent a home in the UK. The East of England also saw rents fall, down by 2% year on year to £874.
The West Midlands recorded the biggest rent rise at 4.1%, taking the average to £643 while in the South West rents increased by 2.8% to £701, and in the North West by 2.4% to £648.
In addition to London, both the West Midlands and Wales saw prices grow by 0.2% on a monthly basis. In Wales the average price is now £599. The only other regions with cheaper rents are the Yorkshire and The Humber at £589 and the North East at £538)
While property investors have seen their returns squeezed by a number of factors in recent times, with new tax changes and higher purchase prices damaging profits, the index data shows that yields in May were unchanged month on month.
The strongest returns were in the North East, where properties typically returned 5%, followed by 4.8% in the North West. At the other end of the scale London has the smallest yields at 3.2% while the average yield across all of England and Wales was 4.3%, the same figure as April but down on the 4.4% recorded a year ago.
‘The West Midlands was once again the top performer in the regional lettings market, with price growth of 4.1% in the last year. This helped the rental market grow overall, given rents in London and the East of England have fallen in the same period,’ said Martyn Alderton, national lettings director at Your Move.
‘However, strong monthly growth in the capital shows the London market may have turned a corner. Landlords also have cause to celebrate as returns remained the stable compared to the last survey. That, combined with the improvement in tenant arrears, shows that the property market still represents a great investment opportunity for landlords across the country,’ he added.
