Taylor Scott International News
The private rental sector in England and Wales has seen its fastest year for rent rises since 2011, with values up 3.4% in 2015, the latest index data shows. The rise took average rents to £794 per month with the East of England seeing rents rise at twice the wider annual pace, up 7.8%, followed by London at 6.3%. The data from the Your Move buy to let index also shows that Yorkshire & Humber and West Midlands both saw new all-time record high rents in December. The significant rent rises over the course of 2015 also come despite a month on month drop in the latest market rents, falling 0.6% between November and December. ‘The fact that the majority of tenants can afford higher rents is certainly good news, and should be seen as a positive indicator as we enter 2016. Yet over the longer term, higher rents also raise a serious challenge for the future affordability of housing in this country,’ said Adrian Gill, director of estate agents Reeds Rains and Your Move. A breakdown of the figures shows that in December, six out of 10 regions saw monthly falls in rents, in line with the overall month on month drop across England and Wales. This was led by London with rents down 1.6% lower, down 0.9% in the North West and down 0.6% in the North East. Four regions saw rents rise on a monthly basis in December, led by Wales at 1.8%, followed by the South West up 0.9%, and Yorkshire and Humber and the West Midlands both up 0.3%. This took rents in both Yorkshire and Humber and the West Midlands to all-time record highs at £556 and £593 per month respectively. Year on year rents increased in eight out of 10 regions led by the East of England with a rise of 7.8%, London up 6.3%, and the East Midlands up 4.7%. Rents fell by 1% in Wales and by 2.6% in the South East. The index also shows that the gross yield on a typical rental property in England and Wales, before taking into account factors such as void periods, dropped to 4.9% in November, down from 5% in November 2015. On an annual basis, this is fractionally lower than the 5.1% gross yield seen in December 2014. The report points out that accelerating property purchase prices are responsible for suppressing rental yields, but have also boosted landlords’ total returns. Taking into account both rental income and such capital growth, the average landlord in England and Wales has seen total returns of 11.3% over the course of 2015, up from 10.4% in the 12 months to November 2015 and the highest for a year. In absolute terms this means that the average landlord in England and Wales has seen a return of £21,110 during 2015, before any deductions such as property maintenance and mortgage payments. Of this, the average capital gain contributed £12,438 while rental income made… Taylor Scott International
Taylor Scott International, Taylor Scott
