12:28 PM, 8th February 2012, About 10 years ago 2
Too many self-interest groups are inflating the real rents buy to let landlords are picking up, claims letting specialist Belvoir.
Data and interpretations are out of step with reality because most of the claims are from operators around London, where rents are much higher than elsewhere.
Belvoir – which has 140 nationwide offices – has reviewed letting data from the past four years and reckons rents in most areas are no higher than they were in 2008, although headline averages make them look much higher.
“Our lettings index has run since March 2008 and during this time we have seen the rise, fall and recovery of the rental market,” says Belvoir managing director Dorian Gonsalves.
“We have learnt about variations in rental data and how to analyse the information to make sure we can track trends accurately and report on a regional and even office-by-office basis. In 2012, with over four years of analysis, we can now confidently comment about national rental trends, regional differences and local changes at office level.
“During 2011 there were frequent reports in the national press about the stratospheric rise of UK rents. However, although our index reveals rental increases in 2011 versus 2010, many regions have still not recovered to the rents achieved in 2008.”
Only five regions are up on 2008, says Belvoir – London (+5%), North East (+6%), Yorkshire (+2%), South West and West Midlands (+1%).
Some places had higher rents in 2011 compared to 2010, but still lagged 2008, with the East Midlands (-6%) and East Anglia (-5%) the furthest away from 2008 heights.
“We are predicting that this regional rental fluctuation is likely to continue throughout the year, although some areas such as the South East are likely to see a higher increase as rental prices force people out of London into the Home Counties. With regard to other areas I think rents will be relatively stable and any increases are likely to be modest,” said Gonsales.
The letting agent found rents in January 2011 averaged £685, hit at £688 in February and dropped to a low of £678 in May and June. Average rental income in December was £679.
In September 2008, rents climbed to £709, fell to a low of £674 in July 2009 (-5%), rising to £697 in 2010 and settling at around £680 last year – still 4% below the peak of 2008.
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