Rising voids and steady rents in January

Posted on Tuesday, February 7, 2023

January's rental market was a mixed bag, seeing rents largely unchanged but voids spiking in certain regions, according to the latest market insight from Goodlord.

"January isn’t traditionally the busiest month for lettings, and the void numbers reflect this"

According to the data, the cost of rent for a property in England rose fractionally between December and January - inching up by half a percentage point from £1,071 to £1,076 on average. This is 8% higher than the same time last year.

Prices, however, continue to remain lower than the record highs recorded in Autumn 2022. Average rental costs in September 2022 hit an Index high of £1,249.81. During January, prices in most regions held steady compared to the previous month. The biggest shifts were seen in the East Midlands, where costs rose from £894 to £924 per property, and the North East, where costs dropped from £800 to £778.

Voids rise despite demand

Despite ongoing demand for rental properties keeping prices buoyant, January recorded a notable increase in void periods across England. The number of void days per property rose from 20 to 23 - a rise of 15%. This follows 6-months of gradually increasing void numbers and is the highest figure recorded by the Index since April 2021.

In July 2022, shortly before rental costs hit their annual peak, voids reached 10 days - a record low for the Index. Voids have been rising month on month since then. The East Midlands, Greater London, the North West, and the South East all saw sizeable increases in their average void periods over the last month. The North West jumped from 20 to 27 days on average, with numbers jumping from 13 days to 17 in Greater London.

In contrast, the South West and the North East saw no change in their average void lengths.

Tenant salaries break records

The Index saw a new record broken in January, with tenant salaries rising higher than ever before. Average take-home pay for renters in England reached £32,195, up 6% compared to December’s £30,346.

Tenant salaries are now 12% higher year on year - well ahead of the average rental cost rise. The biggest shift over the last month came in the North East, where average salaries rose by 11% in one month - from £25,906 to £28,890.

Tom Mundy, COO of Goodlord, comments: “This was certainly an interesting month for the market. There’s clearly a huge amount of demand for available properties and costs are remaining consistently high, but we do seem to have firmly come down from the price peaks seen last Autumn.

"And, at the same time, this was definitely a slower-paced month than we’ve become accustomed to. January isn’t traditionally the busiest month for lettings, and the void numbers reflect this. The tenant salary numbers are also noteworthy, hitting a new high this month, with year-on-year increases to pay continuing to outstrip the average rise in rental prices.”

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