Increasing levels of rents around the UK have softened the blow of recent rises in stamp duty levels for landlords, according to the latest edition of the HomeLet Rental Index.
The research shows that rents have risen in all but one regions of Britain in the three months to April this year, with the average tenancy generating £764 a month, 5.1% up on the same point last year. The typical rent in London now stands at £1,543 a month, a year-on-year rise of 7.7%.
Martin Totty, CEO of Barbon Insurance Group, which compiles the index, said: “The April HomeLet Rental Index has been much anticipated given the potential impact of the stamp duty changes on the private rental market; for now, however, rental price growth in most areas of the country is unchanged from the trends observed over almost three years.”
Totty added: “It may be that over the next several months, the trends observed in the rental market begin to reflect the signs of some slowdown in the rate of house price growth that we are now beginning to see and that will be something to watch closely.
“But more broadly, there has been very little to alter the fundamental relationship between demand and supply, especially in those parts of the country where demand-side pressure is greatest.”
Totty said it remained to be seen whether landlords would try to pass their higher tax costs on, whether buy-to-let property investment would diminish in popularity and whether tenants would be able to afford further increases in rents.
“These questions continue to exercise the minds of market analysts and opinions are divided: the HomeLet Rental Index will provide crucial monthly intelligence on how landlords and tenants are responding as the year progresses.”