Home rental costs down in November

| December 21, 2012
Home rental costs down in November

The cost of renting a house in England and Wales fell by 0.4 per cent in November, its first dip since March, according to a survey by LSL Property Services.

Average rent was £741m during the month, returning to the level seen in September.

However, it was 3.4 per higher than in November last year.

The south east of England saw the biggest drop on a month-on-month basis, with rents down 1.9 per cent.

Rents in the north west of England fell by 1.1 per cent and in the West Midlands they were down 1 per cent compared with October.

Rents increased in London, Wales, Yorkshire and the Humber in November, partly offsetting the falls seen elsewhere.

David Newnes, director of LSL, said: “Landlords look to avoid having properties empty over the Christmas period, and are often more flexible on pricing at this point in the year.

“But the rental market has not ground to a halt by any means.

“The housing market is still haunted by the demons of undersupply of new homes and tight credit conditions for buyers with the smallest deposits, which is pushing up tenant demand.

“This is cushioning the downwards pressure on rents normally seen in the final months of the year, and will see rent rises return as competition intensifies in spring”.

The launch of a £200 million fund by housing minister Mark Prisk is expected to stimulate growth in the private rental market next year.

The Build to Rent fund is expected to increase the construction of properties for private rental by encouraging developers to meet the demand of the rental market in their area.

The fund will finance the work of construction firms until the property is successfully let.

Developers will then repay the government investment.

The fund is expected to boost quality standards of rental property and encourage larger companies and organisations to play a greater role in the private rental market.

Currently, most private landlords are individual investors with a small number of properties.

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