9:27 AM, 24th September 2020, About 3 years ago 2
The latest research from Howsy, has revealed that since lockdown (March), average rent levels have dropped in seven out of 10 areas of England and Wales.
Howsy looked at the average rent paid between the start of the year and lockdown and found that on average, the cost of renting had climbed 2% with just the South West (-0.5%) seeing a drop.
The East Midlands and the North East had seen the most significant increases, up 4.4% and 4.1% respectively. The North West (2.2%), London (2%0 and the South East (2%) had also seen the average rent increase by 2%.
However, with the UK entering lockdown on the 16th March and a ban on evicting tenants following soon after on the 26th, many landlords have seen their rental income dwindle or disappear altogether, a worrying trend that is reflected within the top line figures.
Since March, the average rent paid across England has declined by as much as -3.4%, while Wales has seen a smaller decline (-0.9%).
London has been by far one of the worst-hit regions, with the average rent paid plummeting by -7.9%, while the South East isn’t far behind with a reduction of -7.7%.
The East of England (-3.1%) and Yorkshire and the Humber (-2.5%) have also seen some of the most notable reductions.
The North West (1.3%) and North East (1%) have seen an increase in rents paid while the East Midlands (0.1%) has remained flat, however, all three have seen a notable drop in the rate of growth when compared to the first half of the year.
Founder and CEO of Howsy, Calum Brannan, commented:
“Already, it’s become clear that landlords are paying the price of an eviction ban that has seen many go without any rental income for months on end.
“To see such a considerable reduction in rent levels across the board highlights the prevalence of the financial hardship many tenants are facing across England and Wales and, of course, this is no fault of their own.
“However, while the plight of the nation’s tenants is an unfortunate one, expecting landlords to shoulder this financial decline with no help has dire consequences for the rental market going forward.
“Rents have already been consistently increasing across England and Wales for some time due to the lack of suitable rental stock to meet overwhelming demand.
“However, having been left high and dry, many landlords face no other choice but to start eviction proceedings. This will see them face many months more without any rental income and so it may take some time before rent levels recover to those seen pre-lockdown.
“Should they decide to leave the sector, an inadequate level of stock will shrink even further, causing rents to climb higher to the detriment of tenants nationwide.”
|Table shows change in the average monthly rent in each area sorted by biggest decline since lockdown|
|Location||Average Monthly Rent – Jan 2020||Average Monthly Rent – Mar 2020||Average Monthly Rent – Sept 2020||Change – Jan to Mar (Before Lockdown)||Change – Marc to Sept (Since Lockdown)|
|East of England||£975||£993||£962||1.8%||-3.1%|
|Yorkshire and the Humber||£591||£601||£586||1.7%||-2.5%|