Rising rents allay fears of BTL exodus
Fears that landlords would abandon BTL because of higher stamp duty and tax changes hitting their pockets have yet to materialise, a new report on the growing cost of renting suggests.
Despite more homes becoming available on the market, asking rents outside London rose 2.8 per cent between April and June to an average of £790 per month, the latest rental tracker by Rightmove shows.
And rents continued to grow, even though the number of available homes was 7 per cent higher than the same period last year.
Sam Mitchell, Rightmove head of lettings, said: "Perhaps landlords are remortgaging their BTL properties instead, as they still feel it’s a better investment than looking to other industries.
"It could spell good news for tenants coming to the end of their lease as they might find there is slightly more choice than last year.
"Anyone hoping for a drop in prices due to the extra choice will be disappointed though as rents are following a very similar trend to previous years."
Rents fell slightly only in Greater London and the North East, by 0.2 and 0.3 per cent respectively on the previous quarter, the report confirmed.
Rightmove said Ascot, Bath, Salford, Newcastle, Leeds, Cambridge, Birmingham, Cardiff and Aberdeen currently offer some of the biggest concentrations of available properties for renters in the UK.
The findings were based on the areas with the highest numbers of available rental properties, as a proportion of total housing stock in the areas.
The biggest annual rise in rents was in Newcastle Under Lyme in Staffordshire, with tenants paying 11 per cent more than they did last year for a two-bed at £592 per month.
Bedford, Swansea and Bath also all saw increases of around 10 per cent, while Gillingham, in Kent, saw rents jump 8.7 per cent.
Oldham, in Greater Manchester, the Scottish city of Stirling and Folkstone, in Kent, headed the list of the most in-demand areas for renters.
The average asking rent for a two-bed in Oldham was £498 per month, while Stirling (£632) and in Folkstone (£660) were all below the national average asking price.
In London, the number of available homes was up 8 per cent compared to last year, with the average property costing £1,934 per month to rent.
The most in-demand areas by renters in the capital were Harold Wood, where renting a two-bed costs £1,133 per month, as well as Welling, Peckham, Eltham and Rainham.
Rightmove said a small decrease in rental costs recorded in the capital comes on the back of a 45 per cent increase since 2007, according to separate recent data by analysts Hometrack.