LSL, which owns the UK's largest lettings agent network, including national chains Your Move and Reeds Rains, said that rents in England and Wales rose at their fastest pace in a year in July, up 0.5% compared to June, the second consecutive monthly increase.
Overall, tenants are still getting a good deal. Rents are 4.5% below the peak last August, but the strengthening housing market and growing signs the recession is over suggest sustained rent declines are now a thing of the past.
Tenant finances are in better shape too. Arrears fell sharply in July, dropping to 11.2% of all rent owing from 11.6% in June, meaning rent totalling £247 million had not been paid on time. 517,000 tenants were behind with their rent at the end of July, down from the 529,000 who had not paid up by the end of June.
Landlords are also having less difficulty finding tenants. Voids, the number of days a property stands empty each year, have fallen by 2.5 days in the latest period from an annualised 29.2 days to 26.7. These 2.5 extra days’ rent per year will net landlords collectively an extra £181million that would otherwise have been lost.
Yields slipped slightly in July from 5.04% to 5.02% because rent increases were outstripped by stronger house prices. But, after adjusting for the improvement in longer term arrears and void periods, the effective yield actually rose slightly, from 4.59% to 4.61%.
