SEPTEMBER 2023
£2,900 £3,803 +10.4%
MARKET OVERVIEW
SEASONAL PEAK
With a surge in student lets for the start of the new academic year, demand in the rental market is extremely high. Void periods are low, and many renters are looking to renew.
STRONG DEMAND
The average UK monthly rent reached £1,261 in August, up 10.3% year-on-year (HomeLet), intensified by the usual seasonal peak in student demand. Void periods have risen from nine days in July to thirteen days in August, although this is the second lowest month for voids since July 2022 (Goodlord). The number of prospective new tenants was 38% higher in July compared to a year previously, however the number of properties available per branch has risen by just 24%, meaning the mismatch between supply and demand continues to grow. With demand up and stock levels low, it’s no surprise that over three quarters of agents polled have seen an increase in renters looking to renew, while just 5% reported a decrease (Dataloft Inform Poll of Subscribers).
LANDLORD DILEMMA
Around 400,000 rental homes have been sold by landlords since 2016, including 126,500 since the start of 2022 when interest rates began to rise (CBRE). Policy changes, increasing taxation and mounting inflation and mortgage costs have reduced the financial viability of buy-to-let properties, leading to landlords seeking to exit the market. However, softening sales prices and mortgage rates on the downward trend, coupled with steadily rising rents mean good returns as well as capital growth are still out there for those looking for a medium-to-long term investment vehicle. An estimated 41% of landlords own all of their properties outright, while 35% hold all their properties on a mortgage (Money.co.uk). Those without a mortgage, or with lower loan-to-values are in a particularly strong position.
£1,390 £1,697 +4.8% £14 £1,950 £2,401 +5.4% £20 £3,900 £5,170 +9.3% £46 £1,160 £1,573 +5.6% £14 £1,600 £2,007 +9.2% £18 £2,300 £3,049 +2.6% £23 £2,030 £2,893 +10.3% £23 £1,400 £1,636 +6% £15 £1,500 £1,851 +6.5% £16 £1,300 £1,612 +7.8% £15
0% 2% 4% 6% 8% 10% 12% 14% 16% SEP 2022 OCT 2022 NOV 2022 DEC 2022 JAN 2023 FEB 2023 MAR 2023 APR 2023 MAY 2023 JUN 2023 JUL 2023 AUG 2023
£1,161 £2,900 £3,803
£1,197 £2,990 £3,808
£1,126 £2,760 £3,792