Scotland saw the largest increase in advertised rents in February, reaching an average of £695 per month and up by £20 from January.
A report from property services company Move with Us found that rents in Scotland also saw the greatest rise in rents year on year, up £28 (3.96 per cent).
Average advertised rents increased in nine out of 11 regions in Great Britain in February, painting a much brighter picture for landlords than 12 months ago. Buoyed by significant growth in the majority of Britain’s regions, the country’s average asking rent is now the highest it has been since first recorded by Move with Us in Q3 2012. This is good news for landlords who saw the national average advertised rent rise to £923 per month, an increase of more than £20 when compared to February 2013.
Greater London once again performed well as average advertised rents in the capital grew by £29 (1.31 per cent) in February. This second successive month of growth contributed to the Greater London market outstripping the previous 12 months with asking rents up by £56 (2.54 per cent) since February 2013.
However, prospective tenants in the North East saw rents decline in February. The region saw average asking rents fall by £24 (3.50 per cent) to a more sustainable figure of £673 per month despite an increase of nearly £100 at the end of 2013. However, from the end of 2012 to the beginning of 2013, the region witnessed an almost identical rise and fall to the one experienced this year, following which rents remained stable for six months, and the same pattern is expected in 2014.
Robin King, director of move with us, said: “2014 is shaping up to be a good year for landlords with rents increasing in most regions. The Council of Mortgage Lenders (CML) recently announced that gross mortgage lending was an estimated £15.5 billion in January 2014, a third higher than the same time last year when it was £11.6 billion. It’s likely that many of these mortgages have been granted to buy-to-let investors as we have seen a growing trend for people investing in property instead of using low performing savings accounts.
“The best places for investors however, aren’t necessarily where average rents are the highest but rather, the places with the highest rental yields. This means that, for example, the high rents in Greater London may be deceiving from an investment point of view. Rental yields actually tend to be better in places where property prices are lower like the North East, and the Midlands.
“Any aspiring buy-to-let landlords looking to invest in property should follow the golden rules of finding a place with a good rental yield that is in a nice area and is close to local amenities and transport links. Landlords should also check that the property can easily be upgraded to meet the legally required energy performance rating that will be introduced in 2016.”
