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Private Rental at a Record High

There have been many reports printed recently; stating that private rents are unaffordable to many families, but the latest comes from LSL property Services which says that the average cost of renting a home privately is now at £757.  A greater demand for rental property saw prices rise by 2.1% in September, which outstripped August’s rise by 1.8%.  Conversely, this was on the back of mortgage lenders reporting September as a strong month, continuing on from summer’s increased lending trend.

David Newnes, director of LSL Property Services (which owns estate agents Reeds Rains and Your Move) said: “Higher rents in almost every region shows that, despite Government schemes, buying a first home is still a difficult aspiration.  This is not only down to low salary growth, but also a general shortage of supply – which is the underlying reason why homes are getting more expensive.  The long-term trend to renting therefore looks unlikely to change significantly in the near future.”

The Government has brought forward its Help to Buy scheme, aimed at those who can afford mortgage payments but not the deposit to secure the loan.  The Council of Mortgage Lenders (CML) showed that mortgage lending in the UK stood at £16.2bn in September, slightly less than £16.4bn advanced in August, but 41% higher than lending of £11.5bn last September.

LSL’s survey also shows that tenants finances are stretched; 8.5% of all rents across England & Wales was late in September, up from 7.8% in August.  However, the annual rise in rental costs was less than that of the cost of living; the Consumer Prices Index measure of inflation stood at 2.7% in September.
Sources: bbc.co.uk, cml.org.uk