Rents Stay Red Hot Across England During August 2023 - Rental Index
Published by Magnate Assets on
Sep 4, 2023
The August Rental Index from Goodlord highlights a 10% year-on-year increase in the average cost of rent - and void period lengths remain much lower than year-to-date averages.
In August, the rental market in the UK continued to sizzle, with rents registering a remarkable 10% year-on-year increase, according to the latest Rental Index by Goodlord. Although average rents showed a slight dip from the record-breaking highs of July, where they crossed the £1,300 threshold for the first time, tenants still grapple with elevated rental costs during what is traditionally the market's busiest season. While void periods in August exhibited a marginal uptick compared to July's historic lows, they remained considerably lower than year-to-date averages.
Persistent High Rental Costs
The average rental price across England experienced a minor decline of 1.5% between July and August, settling at an average of £1,347 per property. Despite not surpassing July's record of £1,367, the August 2023 prices reflect a substantial 10% increase compared to the same period last year. These figures underscore that average rental costs remain 15% higher than the year-to-date average for 2023.
Typically, rental prices surge during the summer due to the influx of student lets. This year, this seasonal trend has intersected with existing pressures on the rental market, driving prices to unprecedented heights.
The rental landscape exhibited varying dynamics across regions, with Greater London and the South East witnessing the most substantial average price hikes, at +8% and +14%, respectively. In contrast, the North West saw a -20% drop in average prices, mirroring a similar pattern observed in the region in 2022, characterized by a significant July rent spike followed by a more subdued August.
The North East (-6%) and the South West (-10%) also witnessed rent decreases in August, following substantial cost increases in July.
Void Periods Show Resilience
Void periods, which experienced an intense July, showed signs of moderation in August. The average void period increased from 9 days to 13 days. However, August still ranks as the second-lowest month for voids since July 2022.
Notable increases in void periods were observed in the South West, where they rose from 6 days to 13, and in the North West, where averages climbed from 7 days to 14. Both regions also witnessed the most significant declines in the average rental costs.
In contrast, Greater London and the South East, both experiencing rising rental costs, recorded no change in average void periods.
William Reeve, CEO of Goodlord, commented on these trends, saying, "There were so many records broken in July, it's not surprising to see a slight dip in average rents and slightly longer void periods during August. However, when you look at the bigger picture, the market is clearly still running extremely hot."
"Year-on-year averages for rental costs have seen significant increases, with the £1,300 per month milestone breached for a second consecutive month. As September approaches, traditionally marking the annual peak in prices, it's likely that we'll witness another month of elevated rents and short void periods before any seasonal shift in pace occurs." 🏡💼 #UKRentalMarket #PropertyInvestment #RealEstateTrends