The latest figures from the HomeLet Rental Index reveal that rents on new tenancies agreed over the three months to November fell in most areas of the country.
Meanwhile another report from HomeLet suggests that nine in 10 landlords do not intend to raise rents on their existing tenancies during the first six months of 2016.
Rents on new tenancies remained flat or fell slightly in 10 out of 12 UK regions over the three months to November 2015 compared to the three months to October, according to HomeLet data.
Across the country as a whole (excluding London), the average rent on a tenancy signed during the three months to November was £743 a month, 0.7% down on the previous three-month period. In Greater London, the average rent was £1,544, down 1%.
The index shows that just two regions saw rents on new tenancies rise over the three months to November. In Yorkshire and Humberside, rents on new tenancies were 0.8% higher than in the previous three months, averaging £626 a month; in the East Midlands, rents were 1.2% up at £635 a month.
HomeLet research into landlords’ views about the rental market and their expectations for the year ahead revealed that 91% of landlords do not plan to increase the amount of rent they charge on their properties in the next six months.
Even looking further ahead, only 34% of landlords plan to increase rents over the next 12 months.
Martin Totty, Barbon Insurance Group’s chief executive officer, said: “The research reveals the vast majority of landlords enjoy strong relationships with their tenants and are keen to keep them. Just 4% said they were unhappy with their current tenants, while 18% said high tenant turnover was the most stressful part of being a landlord, more than cited on any other single issue.
“Being a landlord is a long term investment and attrition of tenants is not something landlords desire; our own clients tell us they would rather retain a good tenant over the longer period than seek additional income.”
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Indeed the vast majority of landlords do have good relationships with their tenants are rarely (if ever) increase rents mid-tenancy. So the longer a tenant stays in a place the better the deal their getting. I have tenants that have been with me for years, many of them approaching the 10 year point and they've never had an increase.
However things are now changing. Thanks to George Osborne I am now increasing my rents on my complete portfolio, with the first phase going up in January. New tenancy agreements have already been signed or S13 letters issued.
Not one tenant has refused because they know that I am having to do this and they're still getting a better rate than the market allows. I'm doing this now rather than waiting till 2017 because I believe the Alice in Wonderland tax (thank you Richard Dyson from the Telegraph for the name) means that rents MUST rise by 30% minimum over the coming years and that is really quite conservative (no pun intended). This Chancellor is deliberately forcing rents up so he can raise even more tax.
I have kept my rents in line with Housing Benefit for the last 25 years but with all the new taxes I must increase my rents just to stay solvent. If this means that my benefit tenants will be made homeless that is unfortunate, I do not want it but the venerable and respected Mr Osborne has forced me into a corner.
I am in the minority on this site, a voice supporting increased taxation in the buy to let sector. Be that as it may, when I read posts from long standing Landlords, as is the case today, spreading their financial woes, I don’t get it. Surely these long standing Landlords should be sitting pretty, and not phased by the removal of mortgage interest relief. The sector has had it too good for too long so it is only fair for some pay back. After 20 years of letting, unless continuing to build a portfolio, I wonder why or how any Landlord would be sitting with debt.
Landlords need to move with the time whether Tenants are long standing or not, and if raising rents keeps the bills paid to cover Increases in Taxes and costs then it has to be, Landlords with good track records will keep Tenants who will wantto stay, often if it means paying a bit more, most Tenants will be aware of rises in Taxes and Stamp Duty costs, and those Landlords who are Sitting pretty will have worked hard to get sher they areand should not have to now subsidise New Lettings as that will not be Good Business Practise
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