The likelihood of tenants struggling to pay rent is growing every month, experts warn, as the latest data shows rents rising to record levels.
According to HomeLet, average rents in Britain were £1,213 a month in May, up 1.2 percent from £1,199 the previous month.
Andy Halstead, of HomeLet, said: ‘Rentals remain high, posing a risk for tenants and landlords alike.
“We are once again urging landlords to consider rent guarantee insurance as the likelihood of tenants struggling to pay their rent increases by the month.”
Rising rents: The average rent was £1,213 per month in May, up 1.2% from the previous month, according to HomeLet
The rental market in London in particular shows little sign of slowing down – average rents in the capital rose to £2,039 per month, the highest ever recorded, according to HomeLet.
The cheapest rental area in Britain is the North East, which experienced another dip, falling 2 per cent a month to £632 a month.
Mr Halstead said: ‘The fact that the London market is rising in terms of average price, while the cheapest area in the country – the North East – is falling shows that the level of demand depends somewhat on location, but as a general rule there is a shortage of rental properties to meet demand, with many potential tenants facing a real battle to secure a property.
“In this frantic market, prices are likely to continue to rise in the coming months.”
The cheapest rental area in Britain is the North East, which experienced another dip, falling 2 per cent a month to £632 a month.
Average rent in London in May rose to £2,039 a month, making it the highest ever recorded
In the frenzied rental market, prices are likely to continue to rise in the coming months, experts warn
It follows another rental index released – from Goodlord – which showed six of the eight regions saw rents rise in May, with average rents standing at £1,111 per month in England, compared to £1,103 in April.
It said rents have risen for five consecutive months, with prices now at their highest since September 2022.
The biggest price shift in May was recorded in the South West, where rents rose by almost 3 per cent, from £1,062 to £1,092.
Only two regions recorded a fall in rents, albeit small. The East Midlands saw costs fall by 0.47 percent and the North East by 0.19 percent
| April 2023 | May 2023 | Month to month % change | |
|---|---|---|---|
| East Midlands | £946 | £941 | -0.47% |
| Greater London | £1,897 | £1,903 | 0.32% |
| Northeast | £819 | £818 | -0.19% |
| North West | £880 | £888 | 0.83% |
| Southeast | £1,210 | £1,219 | 0.72% |
| South West | £1,062 | £1,092 | 2.76% |
| West Midlands | £908 | £919 | 1.23% |
| England | £1,103.19 | £1,111.28 | 0.73% |
| Source; good Lord |
The amount of time a property has been unlet and vacant – also known as vacancy – remained stable in May, suggesting that market demand remains strong as the rental market enters the summer.
The Goodlord Index revealed that the average vacancy period in England remains at 19 days, the same figure as in April.
The highest voids are now found in the West Midlands, where the average stand is 23 days. London retains the title for lowest void periods, currently 12 days.
Three regions saw a notable shift in empty periods in May; with the East Midlands, North West and South West all seeing empty spaces reduced by more than 9 per cent.
| April 2023 | May 2023 | Month to month % change | |
|---|---|---|---|
| East Midlands | 22 | 20 | -9.1% |
| Greater London | 13 | 12 | -7.7% |
| Northeast | 17 | 18 | 5.9% |
| North West | 22 | 20 | -9.1% |
| Southeast | 18 | 17 | -5.6% |
| South West | 22 | 20 | -9.1% |
| West Midlands | 22 | 23 | 4.5% |
| England average | 19 | 19 | 0.0% |
| Source: Good Lord |
Oli Sherlock, from Goodlord, said: ‘As we enter the traditionally busiest months of the rental calendar, it remains to be seen whether we will achieve the same high rental costs as last summer.
“But the data indicates that the continued price increase continues and, with vacancy rates holding up as well, the market is certainly poised to warm up as we head into June.”
The rise in rents follows a fall in house prices, according to Britain’s largest building company.
Median home prices recorded their biggest annual decline in nearly 14 years in May, as Nationwide warned that housing market challenges will intensify in the near term.
Property values fell 3.4 percent a year in May, the biggest decline since July 2009, which recorded an annual decline of 6.2 percent, Nationwide said.
The average house price fell by 0.1 percent monthly, compared to an increase of 0.4 percent in April.
The median house price in the UK was £260,736 in May, according to the Nationwide index.