Much-needed momentum returned to the rental market in February according to the latest market analysis from Goodlord who report that, after the traditionally quieter months of December and January, a re-injection of pace during the month brought stronger rents and a significant drop in voids.
"Given the intense demand the rental sector has seen over the last year, I’m not surprised to see how pace has increased during February"
Strong demand among tenants saw the average void period for a rental property in England during February drop by 26% - from 23 to 17 days - with the biggest changes seen in the North West, where voids went from 27 days in January to just 18 days in February - a steep drop of a third (33%).
The East Midlands also recorded a decrease of more than 30% - with void periods in the region going from 29 days to just 20, a 31% reduction. Greater London, the North East, South East and the West Midlands all saw voids reduce by more than 20%. The smallest change was recorded in the South West, where voids decreased from 21 days to 19 days - a 9.5% decrease.
The new average void period for England of 17 days is the lowest since September 2022, when void averages hit 15 days.
Rents rise once again
Rents across most regions in England rose during February, taking the average cost of a rental home to £1,089.04 - a rise of 1% on January’s figures.
Whilst this is still far below figures from last year, when prices peaked in September 2022 at a record £1,249.81 per property, February’s figures are the highest rental averages recorded since October 2022.
The biggest increase in the average cost of rent during February was seen in the North East, where prices rose by 3%. In contrast, both Greater London and the South West saw fractional decreases in the cost of rent.
Year on year, the cost of rent is now up by 12.50%.
Tenant salaries stay high
After breaking records during January, average tenant salaries held steady during February as the trend of higher wages continues.
The average salary of a renter in England was £32,168 in February - up 11.7% year on year. This means wage increases are only slightly behind the increases seen in the cost of rent.
In the North West and the South West, the rise in salaries over the last year has outstripped the rise in the cost of rent.
Tom Mundy, COO of Goodlord, comments: “December and January are traditionally slightly quieter times for the lettings market and, given the intense demand the rental sector has seen over the last year, I’m not surprised to see how pace has increased during February.
“The big drop in voids is a clear reminder that housing stock is low and tenants are moving quickly to secure properties - everything listed is getting snapped up extremely quickly. This is linked to the renewed increase in rental costs. Although we’re not at the cost averages we saw during last summer and early autumn, the price per property averages are significantly higher than this time last year.
“These trends are being intensified by a rise in landlords leaving the market, pointing to an urgent need for decision-makers to incentivise landlords to stay in buy-to-let whilst ramping up house-building efforts. We believe the industry is facing unsustainable pressures and repeat our call for the Government to rapidly take meaningful action to help landlords and tenants alike.”