The rental landscape in England witnessed a significant shift in October as monthly rents declined sharply by over 12%.
- Year-on-year rent growth hit a low, with an increase of only 4%, compared to over 7% earlier in the year.
- Extended void periods from 15 days in September to 19 days in October signalled a cooling market.
- Salaries for renters rose by 5.15% annually, outpacing rent increases for two consecutive months.
- The rental figures suggest a more manageable phase for landlords and agents, amidst ongoing regulatory changes.
The rental market in England experienced a substantial cooling in October, with a notable 12.6% decrease in monthly rents from September to October, according to the Goodlord Rental Index. Year-on-year rent growth also narrowed to 4%, the lowest annual increase reported this year. This shift indicates a relief from the pressures seen throughout summer when rent hikes were more pronounced.
The trend of extended void periods continued, with properties remaining vacant for 19 days on average in October, up from 15 days the previous month. These longer void periods suggest reduced tenant demand, allowing properties to sit unoccupied for longer between tenancies. Interestingly, the average rent was £1,238, slightly higher than last October’s £1,190, but still reflecting a month-to-month decline.
Regionally, every area monitored saw a decline in rent prices. The South West experienced the most significant drop at 24%, followed by the South East with a 16% decrease, and Greater London at 11%. This marked a stark contrast to the three previous months where average rents consistently surpassed £1,400.
Tenants, on the other hand, are experiencing a positive shift in wages. The average salary of renters signing new tenancies in October increased by 1.7% from the previous month, reaching £37,997. This represents a 5.15% rise year-on-year, exceeding the pace of rent escalations for the second month running.
William Reeve, CEO of Goodlord, highlighted the implications of these findings, noting that while tenants benefit from lower rent pressures, landlords and agents may also find this period more manageable amid regulatory shifts. Despite summer’s affordability strains on tenants, these changes point to an emerging equilibrium in the rental sector.
The rental market’s adjustments in October offer a promising outlook for both tenants and property managers.
