Tenants hit hard as rents reach record high
Tenants are being hit by record-high rents and the added cost of the Government's stamp duty rise on buy-to-let properties, a report has found.
Rents rose at their fastest rate for six months in April, hitting an average of £793 across England and Wales, according to the latest Buy-to-Let index.
The study from Your Move and Reeds Rains means tenants have seen an increase of 0.3% month-on-month, while rents are also 2.4% higher compared to the same point last year.
The average tenant is now paying an extra £19 a month, with rents reaching all-time highs in the East of England, the West Midlands and the East Midlands, the research revealed.
It added that the average landlord in England and Wales saw total returns of 10.7% in the year to April when taking into account rental income and capital growth.
Adrian Gill, director of lettings agents Your Move and Reeds Rains, said: "Anyone looking for a home to rent may now find the better deals of the winter months are over. Landlords are seeing renewed interest and competition between potential tenants, as the spring rental market accelerates.
"Some of the reasons for rent rises are extremely encouraging. Tenants looking to find a property to rent are more likely to be in work, getting pay rises, and feeling able to pay their other bills. These wider economic fundamentals are shifting on the side of healthier household finances.
"But very little has changed in terms of the supply of homes to let. So for many tenants, it's likely that a large proportion of any earnings growth is swallowed up by higher rents."
The report also said that some tenants could face higher bills as landlords pass on the cost of the stamp duty surcharge on buy-to-let properties, which came into force on April 1.
Mr Gill added: "And the Government hasn't helped by imposing an extra bill that someone will have to pay on top of this - in the form of the recent stamp duty surcharge.
"To a large extent it's likely that penalty will be shouldered by those tenants looking for homes to rent, due only to the fundamentals of supply and demand in the British housing market."
A Department for Communities and Local Government spokesman said: "This Government is creating a bigger and better private rented sector, which meets the needs of tenants and landlords, while encouraging record investment.
"The vast majority of tenants across the country are seeing their rents remain stable, and are happy with the service they receive from landlords.
"We are doing all of this without the need for excessive state regulation that would destroy investment in new housing, push up prices and make it far harder for people to find a flat or house to rent."