Average rent collected from buy-to-let landlords renting out a one-bedroom property stood at £1,010 in August, according to new figures. Rents for this property type rose by 0.1% in the month, with annual growth topping 1.7%.
The Landbay Rental Index indicates that between July and August, the average rent in the UK for all property types was £1,186. This reflects a 0.12% monthly rise and an annual increase of 1.83%.
Excluding London, typical rents in Britain with the exception of London stood at £745 per month, an increase of 2.29% on the same period last year.
For a two-bedroom property, average rents stood at £1,149 and for a three-bed let, £1,314. This may lead more landlords to take out landlords insurance.
According to official Government figures, rents for an average one-bed property account for 67% of tenants’ average disposable income.
However, this report highlights that pressures on tenants could be subsiding, with wage growth of 2.4% outweighing annual rental growth of one-bed properties.
Tenants in the capital are still the hardest hit, with average rents for a one-bedroom property accounting for a significant 74% of average disposable income.
Outside of London, rents account for just 41% of the overall post-tax income for tenants.
John Goodall, chief executive and founder of Landbay, ‘with a new Prime Minister, a new chancellor and a new London Mayor, bold new steps should be taken to fix the UK’s housing crisis. It must be high on the agenda at the upcoming Autumn Statement, especially given that rising rents are partly due to stamp duty increases being passed on renters.’
‘Phillip Hammond’s fiscal plan should also give more support to savers struggling to find a rewarding home for their money in this protracted period of record low interest rates,’ he added.