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TODAY'S OTHER NEWS

Buy-to-let rents surge ahead of inflation

The UK may be in deflation but this has had little impact on buy-to-let rents which leapt by 4.7% over the past year.

Rents have far outstripped today's -0.1% inflation rate to hit an average of £806 per month across England & Wales.

They did fall by 1.2% in October, however, reducing rents from September’s all-time record high of £816.

Landlords enjoyed total annual returns of 11.6% as property purchase prices accelerated, but yields dropped to 5.0% over the year, according to the latest Buy-to-Let Index from Your Move and Reeds Rains.

Director Adrian Gill said: “The private rented sector is growing rapidly, driven by demand and new properties coming onto the rental market are letting like hot cakes.”

Gill said many tenants are earning more, and while buying a home is still an unrealistic stretch for millions, renting a home is still within reach. 

“The private rented sector is much more closely connected to what people earn than the property purchase market, which has the financial insulation of mortgage payments and interest rates. 

“By contrast, rents are more fundamentally limited by monthly budgets – and now that ceiling is being lifted, average rents are likely to continue to rise rapidly on an annual basis.

“In the absence of enormous numbers of new homes, this could see an increasing share of incomes spent on rent.”

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