Rents Surge to New Highs as Tenant Demand Soars: Insights from Sky News
Published by Magnate Assets on
Oct 6, 2023
While much attention has recently been on the impact of soaring interest rates for mortgage holders, it's becoming evident that tenants are facing their own set of challenges as advertised rents reach unprecedented levels.
Recent data from Rightmove reveals that the average billed rent for homes in Britain (outside London) has climbed to a record-breaking £1,278 per month between July and September, marking a substantial 10% increase compared to the same period last year.
In the bustling capital, the situation is even more eye-watering, with the average asking rent soaring to £2,627 per month—a staggering 12.1% surge over the past year.
Despite these remarkable figures, the competition for rental properties remains fierce, as demand continues to outpace supply. Rightmove reports that the average advertised property across Britain is now receiving a remarkable 25 inquiries from prospective tenants, a figure that's more than triple the pre-pandemic average of eight inquiries.
Ria Laitmer, a lettings manager at Clarkes in Dorset, provides insight into the situation, describing scenes of "queues of tenants arriving at open-house viewings." Meanwhile, Debbie Marsden, director at Marsden's Lettings in Wiltshire, notes "a substantial increase in inquiries per property."
Though the demand in the rental sector remains significantly higher than pre-pandemic levels, there are indications of some relief compared to the previous year.
"Record rents and an abundance of tenants seeking new accommodations have created a challenging environment," says Tim Bannister, Rightmove's director of property science. He adds, "However, there are signs that the tension between supply and demand is beginning to ease, with the number of new rental properties coming to the market now at its highest level since the end of last year."
This dynamic in the rental market, marked by soaring rents and heightened tenant demand, presents an intriguing landscape for property investors. As the market gradually balances itself, investors may find opportunities to navigate this evolving environment wisely and capitalize on the shifting tides of the rental sector.