Rents surge to a record-breaking high as tenant competition heats up – London Wallet

Rents in England have reached an all-time high, soaring 19% in a month, as demand continues to heavily outweigh supply.

Higher demand is being supported in part by a surge in student lets, which combined with rising interest rates and lack of stock, has created an unprecedented upward pressure on prices.

Average cost of rent surges past £1,300 for first time

In July, the average cost of rent in England hit £1,367 per property. This is the highest level ever recorded by the Goodlord Rental Index and is 9.4% higher than the previous record, set in September 2022, of £1,249.

July’s average cost of rent was, at £1,367, 19% higher than June’s averages, when rents sat at £1,148 per property. This is a huge month-on-month increase: the average month-on-month increase in rent during the year to date has been 1.3%.

Goodlord suggested the volume of larger, more expensive properties being let to groups of students in July ahead of the new academic year contributed to the rapid rise in average costs.

Rents rose in every region monitored by the Index. There were significant uplifts in average rents in the North West, which saw a 48% rise in prices (£917 to £1,358), and the South West, which saw a 45% increase in average prices (£1,191 to £1,725).

In July, there were also significant rent increases in the East Midlands (21%) and the North East (25%).

Greater London, the South East and the West Midlands all saw more modest increases.

The West Midlands is currently the cheapest region for renters, with Greater London the most expensive.

The index also shows that rental voids has plunged to hit a record low

As the cost of rent spiked, voids headed in the other direction: dropping by 44% to hit an average of just nine days in July.

This is down from 16 days in June and is the lowest ever void rate recorded by the Index. The previous record was set at 10 days in July 2022.

The North East and the South West saw the lowest voids – recording void periods of just 6 days on average. This, respectively, represented a 60% and 45% reduction compared to June’s void figures for those regions.

The highest voids were recorded in the West Midlands at 14 days, a decrease of 22% compared to June.

Greater London saw the smallest month-on-month change: a 21% reduction in voids, from 14 days to 11 days.

William Reeve, of Goodlord, said: “This month’s numbers are quite staggering. In July we do usually expect to see an increase in rents and a reduction in voids – and all indicators pointed to a particularly red hot summer for the rental market, if not the weather.

“So while the 10% year-on-year increase is a big shift, the sharp drop in void periods is also particularly surprising.

“Digging into the data, we can see a large number of multiple occupancy student lets being confirmed during July, which has pushed up average prices in key regions such as the North East and South West.

“Traditionally, rental costs continue to increase until September before cooling off in the autumn, which could mean these aren’t the last records we’ll see broken before the year is out.”