Changes in the Rental Market
A report by insurance company HomeLet has highlighted shifts in the rental market, documenting an escalation in rental prices. The report recorded a 10.1% increase in rent, with a 12% increase in London specifically, resulting in an average rent of £1,276 nationwide, and £2,179 in London. HomeLet has also reported a 2.2% drop in affordability across the country in the past year (the percentage of income left over after rent). Deposit alternative service Zero Deposit has reported similar findings, stating that rents have surged by 13.7% across England, making the average rent £960 per month. Those in certain major cities are being hit the hardest – Bristol has seen a 40.9% increase in the past half a decade, with average rent now standing at £1,513 per month; whilst Gloucester and Mendip have seen spikes of 38.2% and 33.6% respectively.
In contrast, Zero Deposit found that rents have actually lowered in parts of England since 2018, particularly in parts of Surrey and London. Elmbridge in Surrey has seen a substantial drop in rent by 21.6% (though it still stands at £1,554 per month). Four districts of London have also experienced dips in rent: The City of London at 8.1%, Richmond Upon Thames at 6.5%, Kensington and Chelsea at 3.9%, and Brent at 2.9%. Despite this, HomeLet reported that no area of the UK has seen an increase in affordability, neither since 2018 nor within the past year.
So what does this mean for letting agents?
As more and more landlords are turning to letting agents in recent days, the potential for a mutually beneficial arrangement between landlords and letting agents arises. Letting agents have the opportunity to leverage their expertise and services, and charge a lower commission rate but still maintain their income levels due to these increases in rent prices.
For letting agents overwhelmed with new landlords, having the appropriate tools is essential, and this is where RENT+ steps in. Our Combined CRM for Lettings, Sales, and Management streamlines administrative tasks, boosting your organisational efficiency. This is key to ensuring your lettings agency not only manages an influx of new landlords but thrives in doing so.