Positive Trends for UK Property Investors as Rents Continue to Rise

The latest figures from the Goodlord Rental Index highlight a promising trend for UK property investors. In June 2024, rents saw a significant year-on-year increase of 6.7%, demonstrating the ongoing strength of the rental market.

The Index, which compiles data from tens of thousands of confirmed tenancies, revealed that the average rent in June was £1,225, up from £1,149 in June 2023. This surge reflects the robust demand for rental properties across the UK.

Regional Highlights

1. South West: The region experienced the most substantial year-on-year rent increase, with prices rising by 13%, from £1,191 to £1,347.
2. London: For the first time this year, average rents in the capital broke the £2,000 mark, reaching £2,010, a 2% increase from last year.

Seasonal Peaks

June traditionally marks the start of the high season for rental prices, driven by the influx of students and peak demand. Historically, rental prices peak between June and September, with last year's highest average of £1,367 recorded in July.

Monthly Trends

From May to June, average rents increased by 4%, rising from £1,183 to £1,225. Notably, the South West saw a remarkable 14% monthly rise, followed by 4% increases in both the North East and North West. The West Midlands was the only region to record a slight decrease in average rental prices.

Reduced Void Periods

Alongside rising rents, the average void period—the time a property remains vacant between tenancies—shortened significantly in June. The average void period dropped from 21 days in May to 17 days in June, marking a 19% reduction. Although slightly longer than June 2023's 16-day average, this trend indicates strong demand and quick turnover of rental properties.

Market Outlook

William Reeve, chief executive of Goodlord, highlighted the strong market demand driving up rents. He noted, "If this year’s trajectory of consistent 6-7% year-on-year rent rises continues, we’ll see new records broken across England."

Investor Takeaway

For property investors, these trends signal a thriving market with increasing rental yields and reduced vacancy periods. The combination of rising rents and shorter voids underscores the attractiveness of the UK property market. With continued demand and favorable conditions, now is an excellent time to invest in UK real estate.

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