Being a tenant more affordable since 2016
Original source: Property Reporter
Newly released data from The Deposit Protection Service has revealed that higher wages and lower deposits are helping to take the sting out of renting.According to DPS figures, the proportion of income that tenants spent on rent decreased between 2016 and 2019 despite increases in rental levels, falling from 32.64% in 2016 to 30.64% in 2019.
The DPS said that various factors had helped improve the affordability of renting during the period, including a 2.69% increase in average salary (from £29,559 to £30,353) and a £77 decrease in average tenancy deposits (from £905 to £828) since the introduction of the deposit cap in June last year.
Matt Trevett, Managing Director of The DPS, said: “Although rents have risen over the past decade, other changes since 2016 have helped ensure renting has become on average more affordable.
“Predictions that rents would rise in response to the introduction of the tenant fees ban and deposit cap do not seem to have materialised, with many landlords seemingly declining to increase rents since last summer.”
DPS figures also showed that average rents reached a peak of £777 during the third quarter of 2019 (Q3 2019), before decreasing marginally by £4 to £773 during the following quarter.
Paul Fryers, Managing Director at specialist buy-to-let mortgage provider Zephyr Homeloans, which like The DPS forms part of the Computershare Group, said: “Although the longer-term recovery in rental levels is likely owing to broader economic factors, changes to rental figures are also more likely at moments where property changes hands.
“Over the last couple of years, professional landlords have become a larger proportion of the buy-to-let market as more and more smaller or ‘accidental’ landlords sell up, partly as a result of increasing costs.”
Northern Ireland saw the biggest increase in average monthly rents (3.01%) from £532 to £548 during Q4 2019, while average monthly rent in Yorkshire and The Humber decreased the most, from £551 to £524 (4.90%).
London continues to be the most expensive rental region in the UK, with average monthly rents standing at £1,345 in Q4 2019 – over two and a half times the amount (£518) paid in the UK’s cheapest region, the North East, during the same period. Excluding London, average monthly rent during the last quarter of 2019 stood at £672, said the report.
Source Property Reporter
