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Landlords see sixth monthly rent increase

20th August 2010 | back to article listings BACK    print this article PRINT

Landlords increased their rents for the sixth consecutive month during July as the availability of properties to let remained tight, research indicat.

The average cost of letting a home rose by 0.5% during the month to £676, 2.3% higher than a year ago, according to lettings agent network LSL Property Services.

The group said average rents were now just £12 a month cheaper than when they hit their peak two years ago, before the market was flooded with properties being let by homeowners who had been unable to sell.

David Newnes, estate agency managing director of LSL Property Services, said: "Rents are still playing catch-up with the gains house prices made in the last year.

"The recovery in prices 12 months ago caused an exodus of accidental landlords from the market, ending the glut of supply of rental accommodation.

"Although house price rises have levelled off, landlords are still reaping the benefits of the constrained supply, and the improving yields have restored a healthier balance to the dynamics of property investment."

He added that the group did not expect rents to fall in the near future as when interest rates start to rise again, many landlords were likely to hike their rents further to cover their higher mortgage costs.

Copyright © Press Association 2010

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