The average rental property void period dropped below 2.6 weeks per year in the third quarter (Q3) of this year, according to the latest report from Paragon Mortgages.
Rental Property Void Periods at Record Low
This figure remains historically low and is the first time it has fallen below 2.6 weeks since 2002.
In 2010, the average void period was a high of 3.4 weeks a year.
Paragon has also reported that average rental yields have risen over the last quarter, from 6.3% to 6.4%.
Thinking about the future, most landlords surveyed by the mortgage lender said they expect yields to remain steady over the next year, maintaining current levels.
Over half of respondents called tenant demand stable, with more than 40% stating that demand is either growing or booming.
Landlords are also positive about future demand, with over half of landlords predicting a rise in prospective tenants over the next 12 months, compared to 42% who expect demand to remain stable.
Of landlords hoping to expand their portfolios, 43% are looking for terraced houses, up from 38% in the previous quarter.
The amount of investors seeking semi-detached homes has dropped from 38% to 27%.
The study reveals that requests for long-term tenancies of two years or more remain low, with 58% of landlords stating less than one in ten tenants ask for longer tenancies.
Director of Mortgages at Paragon, John Heron, says: “Our data is indicative of a market growing steadily and sustainably over the long term. With low void periods and steady tenant demand, which is expected to continue growing, yields remain on a gradual upward trend and landlords are confident they will continue to do so.”
Heron continues: “The data also reveals the changing demographic of those choosing to live in the PRS [private rental sector]. This is reflected in the buying intentions of landlords, which seem to be shifting slightly away from investing in multi-occupancy blocks, towards terraced housing – often more suited to young families.”1