Rents heat up ahead of summer
The latest rental index from Goodlord has revealed that rents have hit their highest levels since October over the last month. Rents across England rose by just 1% between April and May, making them now 6% higher year-on-year.
In May, rents increased to hit a new seven-month high, with the average cost of a rental property in England reaching £1,183 per calendar month (pcm). This represents a 1.4% rise compared to April’s figure of £1,166 and is the highest rent average recorded since October 2023, when rents on new tenancies were £1,190pcm. This rise suggests that rents may be heading into their seasonal summer upswing.
The biggest month-on-month change was recorded in the West Midlands, where rents rose by 4%, followed by the North West with a 2% increase. Year-on-year, average rents in May have increased by 6.4%, consistent with the year-on-year rent rises seen throughout 2024. The cost of renting a property in England has increased by £70 compared to May 2023.
Voids across England lengthened during May, reaching an average of 21 days, up from April’s average of 19 days. Average voidage, which measures how long a property is vacant between tenancies, is now 11% higher than at the same time last year, indicating a slight easing in the imbalance between demand and supply. In May 2023, average voids were 19 days.
During May, the most significant shift in void periods was seen in Greater London and the East Midlands, both experiencing a 20% increase in void lengths. The average renter signing a new tenancy in May earns an annual salary of £37,095, up 0.8% from April’s figure of £36,810. The lowest salaries are found among tenants in the North East (£30,718) and the highest in Greater London (£49,883). The average age of renters in England during May was 33.
William Reeve, CEO of Goodlord, commented: “This month’s data may well have signalled the starting gun on summer price escalations. The coming months are traditionally the busiest season for the rental market and the time when rents peak. During 2024 so far, year-on-year rent rises have been fairly consistent – hovering around the +6-7% mark. Rental averages broke the £1,350 per month barrier for the first time in the summer of 2023. That means, if this 6-7% year-on-year trend continues, we could be seeing our first £1,400+ rental average being recorded in just a few months' time. However, while rents continue to outpace both inflation and earnings, there are some signs of pressures easing, as seen in the void figures.”
As the peak rental season approaches, all eyes will be on how these trends develop. The consistent rise in rents, along with increasing void periods, suggests a complex interplay between supply and demand. Renters and landlords alike will need to navigate this evolving landscape carefully, balancing affordability with the pressures of a competitive market. The rental market in England remains dynamic and challenging, and staying informed will be crucial for all stakeholders.
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