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PRS Rents Reach All Time High


Thursday, October 24, 2013
PRS Rents Reach All Time High

PRS Rents Reach All Time High

PRS Rents Increase Again

UK Private Rented Sector (PRS) landlords enjoyed an average return of 7.4% in September 2013, up from 6.1% in August, according to the latest buy-to-let index published by LSL Property Services.

The percentage rises are equivalent to an earned average income of £12,129 (GBP) produced by just one typical rental property in the 12 months leading up  to September 2013, and it is predicted that average returns for landlords and property investors could double over the next 12 months.

The average return for buy-to-let landlords is made up of:

  • Average rental income of £8,164 (GBP) a year
  • Capital appreciation of £3,965 (GBP) in a year
    Total earned over 12 months = £12,129 (GBP)

LSL think that average returns could soon reach £23,028 (GBP), equivalent to a return of 13.6%, within the next 12 months, if PRS rental prices and property values continue to increase at a similar pace as has been observed over the past three months.

PRS rental prices increased by 1.8% during September 2013, to hit their highest-ever average peak of £757 (GBP) per month.

The latest figures equate to landlords earning an average of £13 per month more than they were in October 2012 when the previous all-time record was set, when monthly rents averaged £744 (GBP) across the UK.

The rise of rental prices to record average levels has been matched by a marked increase in lettings activity as tenant demand continues to exceed supply.

The number of new tenancies created in the private rented sector increased by 6.5% in September, reflecting a 9.2% increase over the last 12 months.

PRS rents increased in nine out of 10UKregions during September 2013, and the biggest rent increases were in:

  • South East – rents up 3.3% in a month.
  • North West- 2.7% monthly rise,
  • West Midlands-2.6% monthly rise

The only UK region to observe a drop in rental prices was the East of England where prices dropped by 0.8%

David Brown, commercial director at LSL, said: “Landlords have benefitted from strong yield growth for some time but with such a re-ignited property sales market, there’s now more of a ferocious incentive to invest in the private rented sector than ever before. We expect UK PRS rental yields to hit 5.5% by the middle of this decade, which alongside the recent trend for property price rises, gives every indication the next 12 months are set to heat up even further.”

Landlords can make use of the best products and services provided by specialist suppliers to protect their business interests, such as Tenant Referencing to ensure that only the best tenant applicants are considered and Rent Guarantee Insurance to protect a landlords rental income, should the worst happen and the tenants income or employment status change during the term of a tenancy.

Legal 4 Landlords are the UK’s largest, market leading suppliers of specialist products and services to landlords and the lettings industry in the UK, providing, a wide range of services including:

Tenant Referencing

Legal 4 Landlords pioneering tenant referencing system is unrivalled in efficiency, accuracy and reliability.

It may sound like a bold claim but Legal 4 Landlords advanced system is more efficient and more reliable than any other tenant referencing system on the market.

Landlords and letting agents can track and manage multiple tenant reference reports online with just a few clicks.

Comprehensive Tenant Referencing Services

Comprehensive Tenant Referencing Services

Insurance

Legal 4 Landlords range of specialist insurance products tailored just for UK PRS rental properties has been specifically designed to offer landlords and tenants the best levels of insurance cover at the best possible prices.
Insurance products include:

Landlord Buildings Insurance

 Landlord Portfolio Insurance

Tenants Contents Insurance

Rent Guarantee Insurance

 

Whether landlords own a large portfolio of buy-to-let properties for rental or have just a single-let property investment, non-payment of rent is an increasingly serious and common problem for many landlords.

 

Landlords and lettings agents can protect 100% of rental incomes with Legal 4 Landlords Rent Guarantee Insurance.

 

Eviction Services

Legal 4 Landlords have an experienced in-house eviction team, offering customers unrivalled service reducing the time taken to evict tenants.

Legal 4 Landlords are the UK’s largest specialists in tenant evictions, with over 30 years experience in evicting tenants.

 

100% Rent Guarantee protection

100% Rent Guarantee protection

 


This was written by Mike Clarke. Posted on at 11:30 am. Filed under Eviction, Insurance, Referencing. Tagged , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , . Bookmark the permalink. Follow comments here with the RSS feed. Both comments and trackbacks are currently closed.