September saw the highest average rental costs ever recorded by Goodlord, according to the PropTech firm’s latest index.
With the previous record of £1,238 hit in July 2022, September’s prices took this to new heights. The average cost of rent for a property in England over the last month was £1,249. This is an increase of 1.8 per cent compared to last month, and means average rents are now 13.17 per cent higher year on year.
The majority of regions across England saw an increase in the cost of rent, but a significant surge was recorded in London.
Average costs for Londoners tipped over the £2,000 mark for the first time ever. The cost of renting a property in the capital now sits at £2,055 - a 6.7 per cent jump up from August’s averages.
The only regions to record a dip in costs were the North East where, following several months of higher than expected rental growth, September saw rental costs decrease by 6.7 per cent, taking average prices down to £890.
With demand staying strong across the country, voids remain low. However, no records were broken last month, with voids actually increasing slightly from 14 days in August to 15 days in September. By comparison, in September 2021, voids were 17 days.
London saw a drop in voids - down from 11 days to just nine. Whereas the South West saw a slower pace, with properties taking 17 days to change hands, up from 14 last month.
Tom Mundy, chief operating officer of Goodlord, comments: “This has been another record-breaking month for the market. Whilst we always expect August and September to be busy, we’re seen rents break records for the second time in one summer and London has tipped over the £2,000 average threshold.
“These are truly significant benchmarks and demonstrate a red hot rental market. What happens when this reality meets what’s on track to be a difficult winter for many remains to be seen, but agents and landlords must be prepared for demand to stay high, even as individual circumstances start to shift.”
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Given what rates could go to, I would not want to be a tenant now. The Conservatives are finished. In 2 years time we will have a Labour government, it’s that we need to prepare for 😬
Wouldn’t want to be a Landlord either. Unfortunately I am.
But what do you do as a landlord if your settled tenant of five years or more says "I'm really happy to stay but I just can't afford to pay the extra?". If you try to evict them they won't have anywhere more affordable to go so they may well stay put for months whilst you wait for a court date, maybe won't pay the rent cos they're now full of seethe after reliably paying your mortgage for years yet still ending up being turfed out at the first sign of trouble, possibly even trashing the place or at best not bothering to look after it as their home any more, meanwhile rising interest rates plummet the housing market so selling means taking a hefty capital loss.
Personally I’d keep rent as is….. who says you have to charge a tenant market rent?…. I’ve tenants who’ve been in house for 13yrs, now paying £1000pcm but I could achieve £1300pcm…. With cost of living crisis we’ve told them we know we could get more but won’t increase rent for another year when we review…… in return don’t come to us with silly repairs just they get them fixed…… to me it’s finding common ground, admittedly no mortgage so haven’t increased costs
As I've said before I don't like increasing good excising tenants rent and will keep those increases to a minimum, I increase my rents to market rates when a tenant leaves, good tenants are worth keeping where possible
House Martin - try talking to them. Unless they can't read and don't own a TV they must be aware that interest rates have gone up and at some point that will affect anyone who owns a house, including the person who owns the house they live in.
So how about saying "I'm really happy for you to stay but I just can't afford to keep the rent at its current level".
You don't have to increase it to full market rent. If you don't have to factor in a void, advertising and referencing it can be a bit lower.
Point out that if you can't afford to keep the house they will have to find somewhere else to live, which will cost even more and they would have moving costs to pay.
Not putting up rent except between tenancies used to work for many landlords but now tenants don't move very often, the 'little and often approach' seems even more attractive. I put mine up each year but keep them below market rates. That means I'm not too far behind now & will give the same rise this year. So the rent rise is not unexpected & I never fall too far behind. Rents have to stabilise at some point & hopefully I will be able to make up lost ground. In the meantime I will just have to absorb the mortgage rises and look forward to better times ahead.
With mortgages going up every month there is no way to avoid these rent rises if LLs are to remain solvent :(
Exactly, there will come a point when it makes zero financial sense, all the good will in the world will not pay your ever increasing mortgage If you don’t raise rents.
Well who'd have thought that driving Landlords out the PRS, would cause a shortage of properties to rent and that would cause rents to rise.
Aprt from the Government that is?
It’s greed that pushes prices up. Why do rents have to increase just because “you can”? Just because “it’s market value”? I completely understand mortgages have to be paid for and other costs associated with letting a house but come on some landlords don’t have mortgages. I saw a house last week, it was mum & dads house all bought and paid for yet they still demanding £1050 for a small 3 bed house. I can see landlords being bitten hard if they don’t exercise some self control with rents.
Mortgage or no mortgage, I think you are suffering from a serious case of short memory syndrome.
We have been attacked and battered by higher costs- sec24, selective licensing, eicrs and loads of other red tape burdens to name but a few over the last 7 years as well as the threats of massive epc c costs looming.
I have always had a policy over the last 30 years of not increasing rents whilst tenants are in situ, taking the financial hits myself. As I say mortgage or no mortgage this has to change. I can't run a business in 2022 in this environment on 2012 rents.
'Simples' really. 'Come on!' indeed.
Paul - you're right that greed is involved but you're blaming the wrong people. Try looking at the government with all the anti landlord policies. All the fees, inspection requirements that don't apply to homeowners, extra taxes that don't apply to any other business or asset class, etc.
Just because someone doesn't have a mortgage on a property doesn't mean that asset shouldn't produce an income for it's owner. It's certainly costing them money to insure and maintain. If they sold it the money could be invested in another asset and would produce an income.
Paul, the government refuses to treat us like businesses, we are classed as investors, as such require a return comparable with other investments, finally we are not charities!
We set a profit margin which we wish to achieve on each property, once our profits drop to 5% below that margin we increase rents. If the property is vacant we market price the rent to ensure we are making profit. It’s not greed it’s business
So it must also be greed that pushes car values up, solicitor and accountant hourly rates, the postie and dock workers striking for more money, don't just single out landlords here, even the work shy scroungers want more UC
Because LLs expect a decent return from their investment - its called business.
Don't forget that insurance and labour & materials have all been rising at an alarming rate too.
I'm a LL in Scotland. Rent increase moritorium looming. Interest rates rise or not, no way to pass it on. I'm selling my portfolio, Scottish Government will have to find places for these folk to live.
I've never increased rents for sitting tenants and have kept my student rents unchanged at change over since the big 30% hike in market rents after the SNP anti PRS legislation in December 2017.
However the SNP and their little green (actually deep red) helpers have just sentenced every Scottish tenant to endure the maximum allowable rent increase at the earliest opportunity for years to come.
How can it be fair to ban or limit rent increases to once per annum when mortgage rates can go up month after month?
Perhaps the SNP realise their votes come largely from the renters and not home owners but their policy will hurt their voters well before the next election, although true to form, they'll deny any responsibility and blame greedy Landlords and Tory policies!
Same here Peter
Govt are totally blind-sided and have no clue as to why there's a shortage of stock ! Lol
They have no clue… period 😰. Fun times in 2023 I feel.
Chris, out of interest do you think the government and anti landlord cronies will ever see this housing crisis as one of their own making? And if they do, do you think we have any chance of them acting in the right way to correct it or alternatively act to scapegoat us further? I have been (naively) waiting for the last seven years or so for them to see and correct their errors. As I say I am perhaps very naive!
Saul, you’ll be waiting a long time. Even a basic understanding of economics would point to the fact that increasing costs and red tape for any business will result in an increase in prices and shortages if they are enough to make people exit the market.
Increasing costs and taxes on landlords is lucrative for the government but they feel they need to have an ideological reason to do it, so they are wilfully blind to the damage it causes to those they say they are trying to help.
They will never, ever admit it is their decisions and policies that have caused this. Taking responsibility for bad decisions is something politicians absolutely do not do.
Mortgage free or not its not their business and nothing to do with them, if own it outright its means you have paid it off, may well have used funds from other businesses or savings, why then should you subsidise some one else cost of Living or lifestyle. Suppose Its not paid off and you get in financial trouble the Tenant is not going to Bail you out.
Robert don’t give me a heart attack I am sure you meant existing longterm Tenants, (not sitting Tenant).
I’ll also add - the article claims rents went up by 1.8% in the last month, actually from the figures mentioned above - the increase was less than 0.9%.
Steve, you need to read that paragraph again, a little more carefully this time.
@ Jo Westlake - My case was a hypothetical and the "what do you do ?" was rhetorical - there's not necessarily much you CAN do. Tenants are being squeezed for energy and food so in many cases paying a rent increase is simply not going to be possible, not for them nor probably for whoever might come after them, hence my point.
Which is why selection of tenants and guarantors is now very important , affordability, if they aren't earning enough don't rent to them, better an empty property than one with a non paying tenant in it
Nothing adding up total disaster looming unfortunately, deliberately by Council’s, Government just add Londons Mayor. The economic situation not good or sustainable yet introducing Policy’s to make it infinitely worse. What every Homeowner in the Country needs to wake up to, it’s not just Landlords properly will be affected by those treasonable changes it’s everyone’s property, careful what you support and wish for. Many home owners moving up the ladder, their existing property is often bought by a LL, when that buyer it not there watch your price fall. Mayor of London new data base for Rogue’s he should be first one on it, bringing limiting a standstill, blocking off roads, narrowing roads, stupid unnecessary lines & restrictions all over the place 20 mph, doubling traffic, pollution, journey times, yesterday I went on business journey one part of
the trip involved a No 65 Bus from South Ealing to Great West Road, half a mile took half hour I kid you not. Check it out. Everyone inconvenienced driven mad people were jumping off the Bus at every opportunity and walking, Why is he in charge does he not have a Boss, now he wants to legalise dope as well.
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