Tenants staying for longer to avoid being faced with higher rents



Tenants are looking to stay in their existing rental home for longer as they look to avoid higher rents elsewhere, new insight from HomeLet reveals.

Renters are trying to avoid increases in rental prices, with the latest HomeLet Rental Index, released this morning, revealing that the average rent in the UK hit another record high of £1,103 per calendar month (pcm) in May, up 1% on a month earlier.

When London is excluded the average rent in the UK is now £928, up 9% on last month.

Mike Dawson, a director at HomeLet, said: “With continued universal pressure on households, we’re seeing tenants stay in properties for more extended periods.”

Somewhat concerningly for renters, rental prices look set to rise further in the coming months, which is unsurprising, given the growing supply-demand imbalance in the PRS, as a growing number of landlords, deterred by tax and legislation changes, flee the market.

Source: HomeLet

Dawson added: “As summer approaches, we expect tenants to move at a much higher rate which means average rents for new tenancy agreements will continue on an upward trajectory.

“The rental market plays a critical role in satisfying the UK’s housing needs, and the long-awaited Renters’ Reform Bill needs to strike the right balance by protecting both tenants and landlords.

“With many landlords already exiting the market, the government’s commitment to legislation will provide the biggest change to rental law in a generation and shouldn’t risk marginalising landlords even further.”

Rent to Income Ratios for All Regions

Region  May-22 May-21 Variation 
UK 30.5 % 30.5 % 0.0%
UK Ex London 29.5 % 29.6 % -0.1%
North East 24.1 % 24.0% 0.1%
North West 29.4 % 29.4 % 0.0%
Yorkshire and The Humber 27.0 % 26.8 % 0.2%
East Midlands 28.8 % 29.0 % -0.2%
Wales 29.0 % 29.1 % -0.1%
South West 32.0 % 32.0 % 0.0%
South East 31.3 % 31.8 % -0.5%
London 34.0 % 34.0 % 0.0%
East Of England 30.6 % 31.3 % -0.7%
West Midlands 29.0 % 29.0 % 0.0%
Scotland 26.0 % 25.2 % 0.8%
Northern Ireland 23.4 % 27.6 % -4.2%

 

 

Comments 2

  1. If “striking the right balance” is landlords leaving the market in their droves it is questionable if the Government has the ability to achieve this. Renters are not only staying put to avoid higher rents they also have the problems of declining supply and decline of turnover. This means it is less easy for them to move as choice becomes even more restricted at higher rental levels. As for bottom of the list and problem renters their chances of renting will almost disappear and councils who have contributed with high license fees etc will have to find alternatives to the PRS for their housing needs.

  2. We need to look a bit more closely at the statement “Tenants are looking to stay in their existing rental home for longer as they look to avoid higher rents elsewhere”.
    Surely this implies that rents are not being increased willy-nilly by vilified PRS landlords? I thought we were all supposed to be squeezing tenants until the pips squeaked and “Kicking them out” (Governments own wording) to re-rent at higher levels? It seems not. While it is true that rents have risen for new tenancies in line with house prices, inflation and additional costs imposed on Landlords existing tenancies have been insulated. Why is this? As expressed by many on these pages it is because you treat a good tenant like gold dust. You want them to stay, you don’t want void periods, you don’t want to go through the hassle and cost of finding a new tenant who despite good references could still end up shafting you and live in your property rent free for months while you have to go through the stress and incur the costs of getting them out. Afterwards you are faced with a wrecked property that costs thousand’s to renovate.
    Right now every property we have has tenants of long standing who pay the rent, keep the property clean and tidy and don’t make unreasonable demands. We want to keep them. For this reason we maintain the properties and very rarely increase rents. They all pay below market rent which while being good for them, might well limit their ability to move if they ever needed to.
    This is a bit of a double edged sword for us. We have decided that as our properties become naturally vacant we will sell them but at the current rate they are not going to be vacant anytime soon! Push will probably come to shove if the new EPC ratings do come in, then we will have to sell up or face huge bills.

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