Finally, the ONS has responded. However, unfortunately they don't seem to be keen on putting actual rental data online. The ONS’s Index of Private Housing Rental Prices (IPHRP) is described as “experimental”. The first index showed that rents have risen by 1.3% nationally over the last year.
Long term rental increase masks 'real' fall in rents
Most interestingly from my point of view was the long term data which showed that nationally rents only rose by 8.4% in England during the 8 years from May 2005 to 2013. In London during this time things have been slightly better with rental increases of 11.0%. Whilst in the North-East 5.2% and the East Midlands 5.3% rental increases have been pretty negligible.
The interesting thing for landlords is that if we take the national increase in rents of less than 1% per year this is considerably below the rate of inflation. The rate of increase of inflation during the same period was a total of 30% or 3.4% per annum. In other words rents would have had to risen by 30% not 8.4% just to have stayed the same in real terms.
This means two things:
1. Landlords have suffered a massive real term rental fall. Completely the opposite to what the headlines have been shouting about.
2. Tenants who have been complaining about surging rents have actually been watching the real costs of their rents fall consistently over the last 8 years.
For all those talking about a buy-to-let boom the rental data seems to be painting a slightly contrary picture.
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I have two rental properties, one bought in 2005 and one in 2007. I have been able to increase the rent on first one by about 12% since I bought it, the other one is at the same rent it was in 2007.
ReplyDeleteHowever, this is hardly problematic to the "buy-to-let boom". I'm still getting yields of around 7%, and since I bought both properties with equity release from my own home without spending any of my own money, I can hardly complain.